Vladimir Putin announced the launch of a new national project “Personnel”

During his address to the Federal Assembly, Vladimir Putin announced the launch of a new national project called “Personnel.” Its stated goal is to coordinate the professional self-realization of Russians with the capabilities of the education system and the greatly changed requirements of the labor market. Details about filling the new national project with specific measures have not yet been provided. The final design of this document, with target indicators and methods for achieving them, will depend, among other things, on the situation with the forecast of personnel needs of the economy, which the government should formulate annually from this year.

The list of new national projects that Vladimir Putin announced yesterday included the “Personnel” national project. Like other national projects, it will last until 2030 – however, unlike them, “Personnel” can become a fundamentally new set of measures necessary to solve a problem that the Russian economy has not faced before.

Throughout the 2000s and 2010s, the government’s focus on the Russian labor market was the unemployment rate – it remained significant (7-9%) and could create social tension, especially in moments of economic crisis, such as in 2008. However, already throughout the 2010s, the unemployment rate was declining and in 2019 it began to periodically, in some months, fall to historical lows (for example, in June 2019 it was 4.4%). Then, against the backdrop of the pandemic, the number of unemployed in a matter of months increased by a quarter, by almost 1 million people, but within the next year the unemployment rate returned to pre-pandemic values. At the end of 2023, the unemployment rate was 3.2%. In fact, economic growth itself was considered the main tool to combat unemployment during this period, and the government was ready to use some special tools to support employment or the unemployed directly mainly for the short term – during the economic crises of 2008, 2014 and 2020-2021.

The current disappearance of the unemployment problem, however, has apparently led to the emergence of other challenges – excessive competition among employers for workers and the beginning of a “wage race.” However, since many corporate reports have now become closed, in reality it is impossible to assess how massive the increase in payments was at a particular enterprise. The macro indicator of wage growth in real terms at the end of 2023 (employers called it the most difficult in terms of attracting personnel) amounted to 7.8% and did not surpass, for example, the figure for 2018 (8.5%).

In the future, the number of working-age population in Russia will decline, and this process, which is most likely impossible to influence (at least quickly), is just beginning. The labor force is now only 3% lower, and the number of people employed is only 1% below historical highs of the last 20 years. This will most likely make the problem of labor shortages even more acute, and if it is impossible to influence demographics, then it is still possible to try to redistribute the available labor resources in the economy more efficiently.

This, in fact, is supposed to be accomplished with the help of the “Personnel” national project. Firstly, it is planned to make professions for which there is currently a maximum shortage (the “blue collar” category) more popular, and secondly, to bring educational and professional standards closer together in order to make the entry of graduates into jobs as quickly as possible.

While in his message Vladimir Putin outlined these goals in conceptual form – statements about what specific measures will be included in the new national project or what existing federal specialized programs and projects will become part of it were not made yesterday either by him or by the head of the Ministry of Labor Anton Kotyakov. It can be assumed that the final design of this document, with target indicators and methods for achieving them, will depend, among other things, on the situation with the forecast of personnel needs of the economy, which the government must form from now on annually. It is precisely this forecast, as announced at the State Council in September by Vladimir Putin, that should create personnel guidelines for universities, employers and the regulator.

Let us note that if the difficulties with hiring that Russian employers complain about are structural in nature and are a not yet entirely clear consequence of economic restructuring due to the pandemic (and this is supported by similar problems in the US labor market), then a specialized national project can provide a useful set of tools to accompany this transformation. If it is assumed that the national project itself will establish a certain personnel reality to which the authorities will strive to lead the economy, then the ambition of this task will likely exceed the available capabilities for its implementation.

Anastasia Manuilova