Demand is recruiting workers – Kommersant

Recovery of demand in the Russian economy helps companies to adapt to the consequences of sanctions. According to the RSPP survey, in the first quarter, 11% of enterprises reported that there were no barriers to their activities – a quarter earlier, only 5% of respondents gave such an answer. A decrease in demand for their products in the first quarter was reported by 12% of respondents against 27% in the last round. The impact of such factors as non-payments by counterparties (to 20% from 22%) and, in fact, the sanctions themselves (17% against 20%) decreased less significantly.

The key barriers to doing business were identified by RSPP respondents as the difficulties with the delivery of raw materials, equipment, components, as well as the deterioration in the conditions for transporting products – lengthening of terms, growth of tariffs, denials of cargo insurance. It should be noted that all these problems were exacerbated by the restoration of production in response to growing demand.

When calculating the April manufacturing PMI index of the Russian Federation, S&P Global experts also recorded an increase in logistics costs in the industry – and a corresponding increase in production costs. Traditionally, companies have tried to pass on new costs to consumers, which, however, slows down the growth in the number of new orders (in April they were the slowest in 2023) – customers are hesitant due to high prices. As a result, the growth of business activity in processing in April continued, but more slowly – the index amounted to 52.6 points against 53.2 points in March.

The RSPP survey shows that the most popular strategy for improving internal efficiency was cost reduction (74% of respondents). At the same time, 84% of companies tried to save on administrative and general business needs, 37% – on components and raw materials by switching to cheaper alternatives, 32% – on services. At the same time, in anticipation of a rapid growth in demand, enterprises less often cut personnel costs (14% of companies). Earlier, economists at the Gaidar Institute noted the historically record demand for labor in April (see Kommersant of April 28). In turn, S&P Global records a noticeable activity of companies hiring employees: the pace of job creation became the second fastest since June 2006 (higher rates were only at the end of last year).

Diana Galieva