This is another entry into the BRICS series of Regional Focus posts.

Russia

From one perspective, it could be argued that Russia is awash in opportunities to make a healthy living. After all, this is where many of the world’s famous oil oligarchs call home. However, there is always an alternative perspective to such arguments.

In today’s Russia, there are approximately 1.3 million people who are living on minimum wage. Most surprisingly, around 650,000 (approximately 50%) of these Russians work in the country’s public sector. What these two statistics mean is that a material number of Russian civil servants live on the lowest wage possible that an employer can legally pay an employee. Overall, the average purchasing power parity in Russia ranks 40th in the world. To contrast these figures, Luxembourgers top the study with a purchasing power that is around nine times greater than the PPP in Russia.

These facts can be quite illuminating. Clearly, Russia is very much behind other developed countries, including those of the European Union. Additionally, it should be noted that many private employers pay above the minimum wage. This is a good indication, at least, that the private sector more greatly values the work and effort of Russian employees than the public sector. This should be kept in mind when considering conducting business in not only Russia, but anywhere in the world. Minimum wage is a legal obligation set down by law. However, it would be ideal that employees would earn more than minimum wage as the nature and difficulty of the work changes, regardless of whether or not the work is in the public or private sector. This indicates that employers recognize and value employees, and reward them accordingly when it is financially possible. This would help maintain a positive employment relationship and, ideally, increase job satisfaction.

References:

PKF Moscow

RT