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Work Culture and Labour Market for Expats in Russia

Author: Jim Newham
Submitted: January 2015

Work Culture

The prevailing work culture in Russia is to be very hard-working. Many Russians do not stop working at the weekend and a few even work during holidays. There are some difficulties when working or doing business in Russia. First and foremost, the rule of law does not always apply in this country. This means that the everyday stability that businesses greatly prefer is not always available, and security is a major concern. To combat this, your potential employer may make elaborate background and security checks on you. On the other hand, Russia has copious natural resources and a readily educated workforce.

Formality is the norm in the Russian workplace. The greeting of newcomers is with a firm handshake. Until told otherwise, you should address Russian co-workers by their title plus surname. The default titles are Gaspodin (Mr) and Gaspazha (Ms). The friendlier, traditional Russian term of address, the patronymic, e.g. Ivan Petrovich (meaning ‘John Peterson’), will come later.

In line with the tendency to be formal, Russian companies are hierarchical. The chain of command is considered important and you should observe it as a matter of course. This means that you should focus your attention on the management, as they are the sole decision-makers during meetings. Office managers tend to have large and elaborate offices.

Russia is a bureaucratic society in which paperwork is still valued. This is something you will just have to get used to. The exchanging of business cards is universal; you should have one made up that is written in Russian on one side and English on the other, presenting it with the Russian side face-up. The Russians expect foreigners to be on time for meetings and the like, although they may not be on time themselves.

The Russians’ harsh experiences under Communism have leant a hard edge to their character, which you may encounter when doing business with them. They are tough negotiators and are highly unlikely to be taken in by hard-selling techniques. In negotiations, some Russians engage in gamesmanship, for example by having an emotional outburst and walking out of the room. Rather than taking such displays at face value, you should see them as an extended part of the negotiation process! When negotiating, it is important not to give ground too easily, as this will be seen as a sign of weakness.

You will not need to spend a long time building up personal relationships with Russians in business, as business is seen as transactional rather than being based on building relationships. Initial negotiations may be held at a dinner or over drinks. These will then be finalised in a formal meeting later. Note that there are official and unofficial labour systems in Russia. The latter can on be accessed in surreptitious ways, such as by giving small presents to the right people.

Labour Market

At the time of writing (January 2015), the Russian economy has entered a difficult period, brought on by the collapse in world oil prices. Annual growth in GDP, which was running at about 4% in 2012, has now dropped to below 1%. In December 2014, the Russian Central Bank pushed interest rates up from 10.5% to 17% in an effort to contain inflation. The increase has yet to take effect, as inflation rose from 9.1% in November 2014 to 11.4% in December. Political circumstances have exacerbated Russia’s economic situation, as some Western countries imposed sanctions on Russia after its illegal annexation of the Ukrainian province of Crimea.

Given these current economic circumstances, the near future of the job market is hard to predict. Unemployment in Russia is currently at 5.2% and is increasing, but only slowly, and this figure is still considerably lower than the world average. This may mean that job opportunities are becoming more limited for expats. The most commonly available jobs are in manufacturing, IT and energy, and in consultancy positions in these and other areas.

Russia’s labour market is quite sharply divided between rich and poor: there is a handful of oil billionaires, while the majority of workers earn very little. There is also little employment protection legislation, and this lack of stability is something you will just have to accept. For more information on immigration procedures and working conditions in Russia, see Working for Expats.

 

 

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