An introduction to the developments of the Baltic, Central Asian and Russian labour markets in the post-Soviet era.

1. Labour markets in the post-Soviet space
Picture source: Wikimedia Commons

2. Keywords
•Labour markets
•Post-Soviet space
•Work organisation
•Migrant workers
•Social & labour conditions
•Vocational education and
training (VET)
•Trade unions
•Segmentation of labour

3. Themes of the lectures
1. Introduction lecture
2. The geographical contexts of the Baltic States, Central
Asian countries and Russia
3. Soviet organisation of work
4. Transition from Soviet to capitalist production
5. Migration trends
6. Vocational education and training
7. Role of trade unions
8. Segmentation of labour

4. GEOGRAPHICAL CONTEXTS OF THE
BALTIC STATES, CENTRAL ASIAN
COUNTRIES AND RUSSIA

5. The Baltic States (BS)

6. The BS in light of Varieties of Capitalism theory
•Since the end of ’state socialist’ era, the traditional
dichotomy between socialism and capitalism has given way
to the new paradigm of ’varieties of capitalism’ (VoC)
•The most influental account is that of Hall and Soskice’s
(2001): the distinction between ’coordinated market
economies’ (CMEs) and ’liberal market economies’ (LMEs)
•The BS lie somewhere between the Anglo-Saxon and
Scandinavian models
•The Baltic model more oriented to means-tested (Anglo-
Saxon) than universal (Scandinavian) model
•Labour markets: relatively strict employment protection but
no effective monitoring; the levels of unemployment benefit
among the lowest in CEE countries

7. Social protection and labour market institutions cmp.
Baltic Anglo-Saxon Scandinavian
Social Liberal, oriented Liberal welfare Universal welfare
security on social insurance state, increased state, oriented on
and tax transfers privatisation social services
Welfare Average, financed Average, financed High, financed
state by taxes on wages by taxes and private mainly by taxes
financing investments
Labour Regulated, no Deregulated Regulated, lifetime
market emphasis on employment
regul- life-time employment
ations
Barg- Decentralised wage Decentralised wage Coordinated wage
aining negotiations, small negotiations, small negotiations,
system unions unions centralised unions,
high union density

8. Employment, unemployment, salary in the BS (Eurostat 2014)
Estonia Latvia Lithuania EU-28
Employment rate, % 74.3 70.7 71.8 69.2
Unemployment rate,
%
7.4 10.8 10.7 10.2
Monthly minimum
wage, EUR
390 360 300 -
Average montly
gross income per
employee, EUR*
900
(2013)
765 676 n.a
Gender pay gap, %* 29.9
(2013)
14.4
(2013)
13.3
(2013)
16.4
(2013)
Annual net earnings,
EUR**
5,176 3,336
(2013)
3,142
(2013)
12,397
(2013)
* the difference between average gross hourly earnings of male paid employees and of
female paid employees as a percentage of average gross hourly earnings of male paid
employees.
** Net earnings are calculated from gross earnings by deducting the employee's social
security contributions and income taxes, and adding family allowances in the case of
households with children.

9. The Russian minority in the BS
•The language used to refer to Russian-speakers as non-
Estonian and non-Latvian is not the language of integration
but of separation and exclusion of Russian-speakers from
Estonian or Latvian society. Terms ‘non-Estonian’ and ‘non-
Latvian’ define these groups not by what they are, but by
what they are not, by a lack of some attribute, namely,
Estonian/Latvian ethnicity. (Downes 2007)

10. Dead end in the labour market: An excerpt from my notes
(2006):
”A few years ago my Latvian friend told me that she had
come to a dead end in the labour market. She was a 50
years old manufacturing worker without any knowledge of
the Latvian language. She had no chance of finding a better
workplace in an environment where her employer exploited
her by paying her minimum wage and not allowing her any
discretion in deciding upon work hours. The exploitation
was possible because her employer was aware that there
was nowhere else for her to seek employment.”

11. Geographical context of Central Asia
• five republics of the FSU: Kazakhstan (pop. 17 mln),
Kyrgyzstan (6 mln), Tajikistan (8 mln), Turkmenistan (5 mln) and
Uzbekistan (30 mln)
• there are still 7 mln Russians and 500,000 Ukrainians
living in the republics
• the “Silk Road” ->
crossroads

12. Some more facts
• GDP per capita in 2013, current USD (Russian fed. =
14,600, Lithuania 15,500):
Kazakhstan Kyrgyzstan Tajikistan Turkmenistan Uzbekistan
13,600 1,300 1,000 8,000 1,900
(data from World Bank)
•How much do you know about the ‘Stans’ of central Asia?
–quiz
http://www.theguardian.com/world/quiz/2015/jan/14/how-much-d

13. Focus on Kyrgyzstan (Sippola 2014)
• the minimum wage in 2011 was KGS 690 (EUR 12), mean
monthly wage KGS 2,612 (EUR 144)
•From 2010 to 2011, the consumer prices increased by 20
%, while wages rose by 17 %
•In 2010, the unemployment rate was 59 % (which,
however, does not tell about real employment situation as
½ of urban and 4/5 of rural employment is unofficial)
– Large proportions of people denied unemployment benefits,
since those having arable land over 500 m2 are excluded
– The benefit ranges between 4 and 13, the level is miserable
•Remittances (equating 30-50 % of the country’s GDP)
temporarily raising the standards of living of certain
households

14. Central Asian labour markets
• highly gendered: e.g. the migrants who are from Tajikistan
are mainly male, leave women behind to manage on their
own (Hegland 2010)
– Women left to do double work in order to feed themselves and
their children
– Shortage of marriageable males -> exacerbate existing gender
and generational hierarchies
•In Kyrgyzstan, male labour participation rate is 69.9 %
whereas the corresponding figure for young women is 52.4
% (Elder 2015, 4)
•cmp. Kazakhstan, where situation is much better:
http://www.wageindicator.org/main/Wageindicatorfoundation/wageindic
atorcountries/country-report-kazakhstan

15. The Russian labour market
Picture source: Wikimedia Commons

16. Russia between CME and LME (Kapelyushnikov et al. 2011)
• Russia is a CME:
– governed by very strict formal regulations that are slow to
change, e.g. the rigidity to lay off workers
– Weak numerical flexibility but strong functional flexibility
•Russia is a LME:
– Exhibits significant flexibility and resilience to shocks
– The state is weak to enforce agreements and provide
infrastructure and incentives for co-operation
– Absence of strong corporatist institutions
– Priority of short-term labour market logic over longer term firm or
national competitiveness

17. Russia: current situation
• Crisis 2014-
– Stagnated economic development
•President Putin called in his “direct line” discussion on 18
April for maintaining stable employment levels and not
lifting pension age
•Experts see that the attitude “let’s wait for a little, and the
crisis will come to an end” leads to difficulties (Tatyana
Maleva, RANEPA 2015)
– Demographic crisis: the older generations “able to work” are now
being substituted by the tragically small-numbered generations of
the 1990s
– The campaign of import substitution 2014- : more
executive/productive employees needed in exchange of less
exporting managers

18. Some tendencies in contemporary Russian labour market
• According to statistics by Rosstat in the beginning of 2015,
although nominal wages rose by 6.5 %, real wages in
Russia decreased by 8.3 % year-by-year
•besides trade and services, also industrial production,
construction and transportation sectors went down year-by-
year in the beginning of 2015
•According to a study by Levada Centre in February 2015,
propensity to protest against the deterioration of welfare
conditions has risen from 17% to 23% in half a year
•Some protests:
– In the automotive sector (foreign owners)
– Physicians in Moscow against heightened workload

19. The Russian labour market (1)
• Economically active population in Russia has been over 75
million since 2008, up from 72 million since the beginning of
the 2000s (Adomanis 2013)
• employment has been growing for the benefit of private
sector away from sectors such as heavy industry and
agriculture that were over-emphasized by the Soviet planned
economy (ibid.)
Labour market dynamics concerning employment and unemployment
have not followed a conventional labour market logic during twenty
years of transformation in Russia. At the event of the collapse of the
Soviet Union, employment declined only in a piecemeal fashion, not
drastically as western spectators were expecting; unemployment did
not rise dramatically, either (Gimpelson & Kapeliushnikov 2011).
Simultaneously, however, wages fell drastically. The same pattern was
repeated in recent economic crisis in 2008-09 (ibid.).

20. Particularities of the Russian labour market (1): tight external, loose
internal labour markets (Kapelyushnikov 2009)
• Low rates of unemployment
-> a small number of unemployed job-seekers i.e. there is a tight
(external) labour market
• On the other hand, the internal labour market (within the
enterprise) is loose due to two interconnected factors:
1. The employees cannot afford to get unemployed
2. In international comparison, firing employees is difficult
-> which has led to widespread elasticity in wages and working
hours within an enterprise
CAUSE: LACKING UNEMPLOYMENT SECURITY; STRICT
REGULATION ON EMPLOYEE FIRING

21. Russian labour market (2)
• while the rate of unemployment was 10.6 in 2000, in 2013 it
was only 5.5 (Rosstat)
•Experts at the HSE in Moscow have estimated that there are a
few millions more in the ‘shadow’ economy in Russia now than
there were last year (meduza.io 27 February 2015)
– While the proportion of the unofficial economy of the entire
economy is now 15-17%, it can rise to 20% during the crisis
– The forerunners in using unofficial labour are such sectors as
trade, construction, personal services and agriculture
•Subsistence agriculture: 40 % of adult population involved in
work on private allotments during the season

22. Particularities of the Russian labour market (2): doing ”unofficial” work (Lehmann & Zaiceva 2013)
• The term “unofficial” here refers to the enterprises that have
not been registered or they are partially registered, and to
employment relationships that have partial or completely
lacking protection against unemployment, sickness or old age
• Uneducated, male construction and trade workers have the
biggest risk to get “locked in” the unofficial sector
• There is no significant wage-based difference between the
“official” and unofficial occupations; enterpreneurship in the
unofficial sector can even be more “profitable”
CAUSE: THE CULTURE OF TAX EVASION AND CORRUPTION

23. Russian labour market (3)
• an interview with Tatyana Maleva, RANEPA (Gazeta 24
February 2015):
– Mismatch in the labour market: there is a high demand for
industrial jobs, but supply of lawyers, business and marketing
people
– By 2030 the number of pensioners equal to the number of
employees in Russia
– Life expectancy increased in Russia
– Need for pension reform now; the effect will be seen in 15-20
years
– She suggests a modest increase in pension age: for men, to 62-
63 years, for women, to 60 years
– In Russia, there is a common phenomenon of being on pension
and wage-earning position simultaneously

24. Russian labour market (4)
• to correct the mismatch between supply and demand of
the labour market, the Russian government has initiated a
campaign to “popularise” such occupations as lumberjack,
construction worker, railway worker (Gazeta 15 March
2015)
– Such campaigns have little chance to become successful if the
wages will not increase in these professions

25. Particularities of the Russian labour market (3): a large share of
immigrants
• Immigrants from the Central Asia occupy the peripherial
segment of the functionally segmented Russian labour
market
• Russia has the second biggest immigrant population in the
World (11 million), which is not, however, comparable to that
of the USA, 45 million (Rossiiskaya Gazeta 12.9.2013)
• The immigrant flow even accelerated in the first half of 2013;
it was estimated that in Moscow that time, there were 3.3
million immigrants and in St. Petersburg and Leningradskaya
oblast 2,5 million (Argumenty Nedely 22.10.2013)
• This development has provoked racist attacks and even
murders against non-slavic people in the big cities (Human
Rights Watch 2009, 13)
CAUSE: AGEING POPULATION AND POOR WAGES

26. THE SOVIET ORGANISATION OF
WORK

27. The Soviet work organisation
•formal Taylorist methods of piece-rate payment systems
and the ‘scientific organisation of labour’
•informal relations between management and labour
(monitored by Party and trade union bodies)
•elite (kadrovye) workers* granted a good deal of autonomy
and control over the labour process
•the sturmovshschina (storming) practice
•enterprises faced with deficiencies of supply
*‘Kadrovye’ workers merited their position on the basis that they had worked in
the department for a sufficiently long period (10 to 15 years), acquired
appropriate skills and a good disciplinary record, plus some record of voluntary
social or political activity (Clarke 1996, 44; Schwartz 2004).

28. Alexey Stakhanov 1935
https://www.youtube.com/watch?v=Bnvt6q8OcFA

29. Management Sovieticus (Liuhto 1993)
• emphasis on quantity instead of quality
•the Soviet enterprise did not produce according to the market
but to the plan
– Market supply more important than demand
•Managerial power was limited
– Vertical bargaining (governing institutions)
– Horisontal bargaining (supply firms)
– Internal bargaining (work effort)
•formation of managerial elites, tolkachi and krugovaya poruka
relationships
•authoritarian paternalist style (Clarke 2004)
– The regime controlled workers by engaging them as collectives (the
system) and individuals (the enterprise)

30. Labour segmentation under ’Management Sovieticus’
• tendency towards labour force segmentation and informal
bargaining. The strict confinement of wage funds within the limits
of the plan provoked management to rely heavily upon the layer
of elite (kadrovye) workers with exemplary qualities of
commitment, competency and loyalty (Schwartz 2004)
•there was a considerable number of ‘reserve’ workers confined
to routine and auxiliary work with few, if any qualifications.
Management also used this segment of the workforce as a
means of social control over more highly skilled workers
•’Kadrovye’ workers: the key workers for western companies in
Russia?

32. TRANSITION FROM SOVIET TO
CAPITALIST PRODUCTION

33. The disintegration of the SU and work organisation (Schwartz 2003)
• The economic turbulence associated with disintegration of
the Soviet system meant that enterprises had less and less
money available for reinvestment in new equipment and
technology
– Most enterprises operated considerably self-sufficiently, while
they marginal savings and minor reinvestments
– This occurred usually at the expense of wages
– The employers tackled the problem of labour turnover by
increased hiring to meet production demands
– Workers consented to meagre pay because there are few
alternatives to working in order to survive

34. Unofficial practices in transition (Alasheev et al. 1997) – factory
”Кольцо” (Kol’tso)
• Unofficial agreements between workers and masters (”do
not exceed the plan”, hiding drunk workers so that the
department chief will not lower the collective premium)
•Recruitment of company workers’ friends; the worker who
gives a ”recommendation” also takes responsibility for the
quality of the new worker
•Promotion based on networks, ”blat” (especially women)
•Using non-monetary rewards to retain a qualified worker
•There is a gradual eradication of unofficial practices in
Russian enterprises occurring in the 2000s, because of the
consolidation of Russian economic situation after the
”crisis” decade of the 1990s (Borodkin 2010, 252)

36. Azorbo & Eliasson (2001): Swedish subsidiaries in a post-Soviet
country
• attribute ‘management sovieticus’ to poor quality of
production in the Baltic subsidiaries of Swedish firms (as a
consequence of the emphasis on the quantity of production
under the Soviet time) as well as to the fact that superiors
make decisions on behalf of subordinates
•According to Azorbo and Eliasson’s analysis, it seems
obvious that the headquarters increased control over the
daughter company due to suspicions that the Soviet style
still persisted in Baltic management culture

37. Leadership traits (Puffer 1996, 302)
Traditional The communistic Transition period
Russian society rule
(1400 to 1917) (1917-1991) (1991 to present )
------------------------------------------------------------------------------------------------------------------
Leadership motivation
Power
Powerful autocrats Centralised leadership Shared power and
ownership
Responsibility
Centralisation of responsibility Micro managers, Delegation of strategic
macro puppets decision-making
Drive
Ambition
Equal poverty for all Service to party & Overcoming the sin of
collective goods being a winner
Initiative
Look both ways Meticulous rule following Let’s do business
Tenacity
Life is a struggle Struggling to accomplish Struggling to accomplish
the routine the new

38. Leadership traits (Puffer 1996, continued)
Traditional The communistic Transition period
Russian society rule
(1400 to 1917) (1917-1991) (1991 to present )
------------------------------------------------------------------------------------------------------------------
Honesty & Integrity
Dual ethical standard
Deception in dealings Two sets of books Wild capitalism
reliance on friendship personal integrity personal trust
Using blat connections
Currying favour Greasing the wheels Greasing palms but
with landowners of the state learning to do business
straight
Self-confidence
From helplessness From inferior quality From cynicism
to bravado to ”big is beautiful” to over-promising

39. Cmp. Dunn (1999, 128-129), a Polish factory:
Socialism Capitalism
BackwardnessModernity, civilization
Stasis Dynamism, movement
Inadaptability Flexibility
Age Youth
Drabness Colourfulness
Deprivation Satisfaction of wants
Obedience Critical self-reflection
Collectivism Individualism
Gifts Sales
Personalized relationships Impersonal relations based on
based on “connections” rational calculation

40. Recruitment methods in Russian companies by type of ownership
(Gurkov & Zelenova 2009)
Type of ownership
Form State Individual Limited Joint
partnership stock
----------------------------------------------------------------------------------------------------------------------
State employment centers 27.4 9.4 16.9 18.5
Personal connections 74.8 72.4 75.3 77.7
Publications in mass media 27.8 35 33.8 33.3
Ads in the mass media 39.6 51 51.6 52.3
Via the Internet 25 31.6 40 35.2
From universities 55.2 48.8 47.9 52.8
Headhunting / agencies 46.5 63 71.7 73.7
Via professional associations 44 31.4 43.3 53.8
Via databases 25.9 15.2 11 19.2

41. Towards individualisation?
• In Western labour markets, individuals facing risks (of
unemployment , career choices etc.), where they to a greater
extent are exposed to market forces and abstract system
-> life rendered a ’planning project’
• In conditions of ’late modernity’, old certainties and modes of
living rooted in custom and tradition are being destabilised
• Russia’s variant of ’late modernity’ led to extremely rapid and
throughout individualisation (Walker 2011, 4)
-> socializing agencies are no longer capable of transferring the
’values and patterns of behaviour’ young people had followed
previously
• Some studies, however, show that perhaps the changes have
not been that radical (Tomanovic & Ignjatovic 2006)

42. The role of women (Walker 2011, 46-49)
• The gendering of the roles of industrial jobs has its roots in the
Soviet period (not in such occupations as foreman or shop
manager)
•Women as a secondary labour force became more deeply
embedded in the post-Soviet period, at least in the state (or
former state) enterprises
•Gender a recurrent theme within investigations into informal
employment and small-scale economic activities
•Taking on increasing responsibility for families & turning female
domestic responsibilities of sewing and cleaning into forms of
petty entrepreneurship
-> manifestations of a retreat into a primitive domestic econnomy
(see also Burawoy et al. 2000, 43)

43. Case study on Nordic-owned factories in Russia 2011-2013
(Sippola)

44. An excerpt from an interview:
R: Well, I think any person who is over, I don’t know, 33, 35 years, has been
brought up in Soviet Union. And then in any person who has been brought
up in this kind of environment, then there would be Soviet mentality. I think
that in any person, in production or in the office, who is over 35, you will
find Soviet mentality, whatever you mean by that. What you are saying is
mainly bad things, what I notice [laughs]. Relaxed, whatever. I don’t kind of
feel it like that, black and white. In my view, part of Soviet mentality is for
example being loyal to your employer, being responsible. Being able to go
extra mile, if it’s necessary. Being a team person, because in Soviet, I think
in Soviet culture..

45. R: ..it’s common to work as a team, and it’s common to do some, being kind
of involved in the process, not for the sake of money. Because what we got
from this kind of post-Soviet thing is this, I think one of the worst things that
we have now is this consumerism, that people are people are becoming
more and more just this very kind of primitive, consumer-oriented. And
that’s I think the worst things that we, one of the worst things that we got
from this change. Because in the Soviet times, I think it was more, because
ideology I think was so strong, it was more for the sake of common interest.
And it’s, I think it’s pretty natural for Russian culture. If we come back to the
times before the Soviet times, because Russia has traditionally been an
agricultural country. And being an agricultural country, a lot of effort was put
in surviving together. Because you cannot survive in these tough conditions
if you are alone. So I think one of the things which is a characteristic for
Soviet people is this kind of supporting each other, informal
communications. Because a lot of things were built on communications and
on relations. So, Soviet culture would be very much personal relationship, a
lot about personal relationship. And I think we have it in our production,
good and bad of it [laughs]. Because a lot depends on how you really feel
about people. So, yes, sure, there would be some things.

46. Institutional bricolage?
I: Do you see any Nordicness in this company organization?
R: Being a Danish company? Yeah, I think I do.
I: What’s that about?
R: I think it’s about corporate culture. Denmark being in general, again, in my personal
opinion, very kind of people-oriented and socially responsible kind of country.
I: Exactly, that’s the Soviet values.
R: Soviet values. And that’s why I think, Danish culture very well goes in line with Soviet
culture [laughs]. Because, we often call it Scandinavian socialism, because it’s about being
socially responsible, it’s about being stable, it’s about taking care of employees. And it’s
about being, I don’t know, pretty straightforward. I think Nordic culture, compared to, I
don’t know, eastern culture for example, it’s very straightforward. What I personally like
about Danish people is that very often you know where you are with the person. If there
are some problems, then you will hear about it. If something is good, then you will also
hear. And it goes very well with, again, Russian culture, I think. Because Russians are also
pretty open. Maybe pretty tough sometimes but in general pretty open about problems and
issues and everything. So, that’s why I think Danish or Nordic culture goes very well in
line with Russian culture.

47. MIGRATION TRENDS

48. The BS: emigrant / immigrant flows
Emigran
ts
2010 2011 2012 2013 2014
Estonia 5,294 6,214 6,321 6,740 n.a
Latvia 39,651 30,311 25,163 22,561 n.a
Lithuania 83,157 53,865 41,100 38,818 36,621
Immigra
nts
2010 2011 2012 2013 2014
Estonia 2,810 3,709 2,639 4,098 n.a
Latvia 4,011 10,234 13,303 8,299 n.a
Lithuania 5,213 15,685 19,843 22,011 24,294

49. Personal ”exit”
• It is highly possible that given the Soviet experience, the
post-socialist worker is simply opting for individualism and
for a personal “exit” into other jobs or to abroad
– This mainly concerns the mobile workforce but this principle does
not hold as regards the elderly Russian-speaking immobile
population
Emigrants stocks in EU25 (Tirpak 2007, estimations from 2006)
Persons Percent of home country
labour force
Lithuania* 157,480 10.0
Latvia** 99,600 8.6
Slovakia 225,810 8.5
Poland 1,207,070 7.1
Estonia 31,030 4.5
Czech Republic 54,480 1.0
Hungary 25,430 0.6
Slovenia N/A N/A
*) sum of declared and non-declared emigrant flows in 2001-2006
**) EEA countries and Switzerland included

50. Estonian minister of social affairs on 17 December 2010
(Postimees):
• There are 77 000 people in Estonia who want to emigrate
for job-seeking
•43 000 of these have already made preparations for the
move, such as language training (15 % of which will move
permanently)
•According to Egle Käärats, vice chancellor of the ministry,
finding a job abroad is much better alternative than a long-
term unemployment and marginalisation in Estonia

51. Reasons for exit from Kyrgyzstan (Sippola 2014)
•Low income levels and unemployment in the home country
•The demographic crisis in Russia and increasing demand
for labour in neighbouring Kazakhstan
•Russia offers a high demand for auxiliary jobs with decent
wages
•Rapid industrial restructuring, population growth
•The inability of the government to address social problems
– Growing social instability due to the deterioration of education, health
care, culture and other services
– High poverty and inequality rates
– The collapse of the social security system being compensated by the
actions of individuals, who send remittances to their home country

52. Dependency on remittances
• The economies of Central Asia are heavily dependent on
remittances of migrant workers to home country (World Bank):
-> 42 % of Tajik economy, 31.5 % of Kyrgyz, 25 % of Moldavian,
21 % of Armenian, 12 % of Georgian and Uzbek, 5.5 % of
Ukrainian, 4.5 % of Lithuanian and 2.5 % of Azerbaijani economy
depends on remittances
• The ruble crisis has drastically decreased the flows of
remittances in 2015
• Living standards in the Central Asian countries are being
pressed by the falling exchange rate of ruble (Guardian 18 Jan
2015)
http://www.theguardian.com/world/2015/jan/18/russia-rouble-
threat-nine-countries-remittances

53. The proportion of foreigners working in Russia, 1998-2008, thousands
(Ryazantsev & Horie 2010, 20)

54. Biggest immigrant populations in Russia, by country of origin
2008, thousands (Ryazantsev & Horie 2010, 22)

55. The allocation of migrant workers into different occupations in
Moscow in 2007 (Ryazantsev & Horie 2010, 46)

56. Migrant workers as a new form of work organisation in Russia
•Majority of migrant workers come to work in Russia
seasonally (in the spring/summer) individually or with help
of relatives and friends, or through private (agency) firms
that do not have the license for employment (Ryazantsev
2010, 63-64)
•Due to the lack of necessary resources/infrastructure
dealing with labour migration, there are private agencies
that ask money from workers (ibid.)
-> typically this activity is associated with betrayal, loss of
money and sometimes withholding of documents of the
migrant

57. A possibility of multi-ethnic future for Russia?
•A tajik worker singing Indian song:
https://www.youtube.com/watch?v=ZMHHFn9Zi0c

58. Peculiarities of Ukrainian labour migration (Безматерных и Чжан
2008)
•An important factor for social and economic development
of the country
•The scale of worker mobility is estimated to be between 7
and 8 mln people
•No more than 500 thousand people have an official
permission to work
•About 2 mln Ukrainian people live abroad on a permanent
basis, visiting Ukraine once in 3-5 years
•Majority of the migrant workers are employed in seasonal
jobs lasting 4-10 months

59. How many potential emigrants in Russia?
•A survey made by the Russian Public Opinion Research
Center in 2013
-> 20 % of the respondents wished for moving from Russia
to another country for work (in 1991, 13 %)
-> 21 % wished to move for permanent residence (5 %)
•From Jan to Aug 2014, 200,000 Russians emigrated ->
highest figure in 15 years
– Particularly from the Kaliningrad region to Poland and the BS
– Germany a particular land of dreams (for 1/5 of those left)

60. A comparison between EU and Russian migration politics
• There is (still) a fundamental difference between the EU
and Russia in relation to labour migration:
1.In the EU, migrant workers are perceived as a resource
-> although there might be weaker social conditions, labour
is not exploited in the first hand; the use of labour is
bottomed upon the idea of allocation of ‘human capital’
2.In Russia, migrant workers seen as a problem
-> the flow of migrant workers creates problems, although
high-skilled ones are welcomed…

61. A comparison between EU and Russian migration politics (2)
•The EU provides the local level with support in the form of
structural funds for the provision of services and facilitating
the access to the services
•Russia seeks to minimize contacts of professionals and
their employers with the Federal Bureau of Migration (FMS)
Local level
National level
Working migrantEuropean
Union
Russia
+
-

62. VOCATIONAL EDUCATION AND
TRAINING

63. School-to-work transitions in the Soviet Union (Walker 2010, 41)
• comprehensive state intervention aimed at ensuring “close
functional fit” between labour supply and demand
•Young people both guaranteed and compelled to take up
allocated work placements
•The system of ‘distribution’ (raspredelenie) = mandatory work
placements for graduates of higher and secondary vocational
educational institutions (VUZs and SSUZs)
•Training in IVET* colleges (PTU) required to fulfil quotas for
workers at local enterprises
-> VET policy a part of the wider objective to engender social
stability through social control
* Initial Vocational Education and Training = the end destination of educational careers of
young people from manual worker backgrounds

64. Need for further development of human resources in the Central
Asian region (OECD 2012, 23-24)
• Misalignment between worker skills and job market
requirements:
– Excessive central control over educational curricula
– Low public spending per student
– Low completion rates of advanced study
• Tertiary education over-theoretical and poor-quality
-> Low level of performance and inability to apply what has
been learned to work and later life

65. The cases of Kazakhstan and Kyrgyzstan
• In Kazakhstan, the OECD review of higher education
(2006/2007) pointed out, that
– VET institutions suffered from low status, underfunding and the
exclusion from the higher education system
– There were too few graduates with scientific and technical qualifications
(few candidates for middle managers’ / technicians’ positions)
– The employers were not dissatisfied with graduate standards
•In Kyrgyzstan, the OECD review concluded that
– In general, the VET system was weak and becoming even weaker
– Because of massive downsizing of state-owned enterprises and to loss
of traditional jobs, half of young people (between 15 and 29) are
unemployed
– Many of these young people are in VET because they cannot afford the
fees for higher education

66. Closing the skills gap in Tajikistan (the World Bank 2015)?
• Tajik economy undergoing profound structural changes
from agricultural and industrial economy towards services
•High population growth – 40 % under 17 years
•Consequences of this: 1) 1/3 of the working-age men
working abroad, 2) employment in the informal sector
•The education and training system has a mixed record in
skill formation
-> the government should shift the focus from providing
access to educational institutions (which largely fail in
providing adequate education) to providing skills (cognitive,
non-cognitive and technical) to students who need to
succeed as adults

67. Tajikistan continued (Ashurov 2015)
• After completing elementary school every year 85-90
thousand young people enter the labour market without
vocational training
•Limited territorial mobility and restricted access to higher
education of the poor -> increases the social significance of
VET
•The inability of the economy to provide jobs in the national
labour market encourages labour emigration

68. School-to-work transition in Russia (Walker 2011, 43-47)
• Bauman’s (1998) and Sennett’s (1998) ideas on the
demise of life narratives based on coherent, class-based
identities in the new work-life particularly relevant in the
post-socialist context
•Young people appear to have lost their ‘privileged’ position
•Administrative channels into employment have either
declined or disappeared
•No effective infrastructure of labour market intermediaries
•Employment possibilities in rural areas especially
challenging
– Young people more inclined to leave their villages than to take
up the local employment opportunities available to them

69. Change in preferences of young people (Walker 2011, 49)
• Professions such as lawyer, businessman and computer
programmer rating highest in surveys
•These have displaced the most popular orientations in the
Soviet period such as doctor, engineer and university lecturer
•A generational split:
– The disruption of socio-cultural norms
– A lack of formal opportunities in the labour market
– Young people are also more reluctant than older ones to change
their more secure state jobs into street trading or kiosk jobs or to
work in enterprises ‘on paper’ (earning part of their income
through secondary employment in commercial sphere)

70. Active Labour Market Policies targeting youth (Walker 2011, 52)
•Youth work placement scheme – arranges temporary work
placements with local employers; provides young people
with work experience opportunities
•Careers guidance – combines psychological profiling with
a focus on fostering awareness of local labour market
conditions
•Quota work places – grants tax breaks to employers
guaranteeing jobs for particularly hard to place (orphans,
young people with disabilities)
•Public works schemes – generate temporary employment
and additional earning opportunities

71. Initial Vocational Education and Training in transition (Walker 2011,
59-60)
•Reforms since mid-1990s:
– The narrowly focused courses (from the Soviet time) have been
amalgamated into broader curricula, which provide students with
wider sets of skills
– Profuchilischcha directors granted greater autonomy in
determining which courses will be taught
– ‘social partnership’ with employers, employer associations, trade
unions and the employment service
•Nonetheless, over 80% of profuchilischcha courses of the
early 2000s geared at the industrial sector, while the
equipment used for practical training often dates back to the
1970s

72. Secondary vocational and high education in transition (Walker 2011,
61-63)
•Reforms introduced:
– The introduction of new disciplines e.g. commerce and foreign
languages
– Many tekhnikumy have transferred themselves into kolledzhy
with a wider range of service sector disciplines such as banking,
finance, management and marketing
– More autonomy for higher education (although we might be
witnessing a setback in the face of the RAS reform)
– Introduction of a three-tier degree system (‘incomplete’ higher
education, bachelor’s and master’s degrees) supplementing the
traditional ‘specialist’ qualification
•However:
– New private as well as state institutions charging fees
– Enormous variation in quality

73. The Bologna process & Russia (Gänzle et al. 2009)
•The Bologna process (aiming at increased student mobility
as well as increased compatibility, comparability and
competitiveness of higher education institutions) become as
a benchmark for higher education reform in Russia 2006-
2010
•Gänzle et al. (2009) have investigated Kaliningrad with a
view to the implementation of the Bologna process
– Kaliningrad as a ‘test’ region for reforms
– The Kaliningrad-based actors would like to pursue further
adaptation to the European model (especially in the younger
segments of university faculties e.g. the EuroFaculty)
– However, Moscow allows for marginal discretion in terms of
Kaliningrad’s higher education policy

74. The VET system in Lithuania?
•What kind of similarities to the Russian situation in terms of
VET:
– The fall of traditional industries and the ability of educational
institutions to face this?
– The gap between education provided and the demand for
labour?
– Changes in preferences of young people?
– Lacking quality of colleagues, technical schools, higher
education institutions to provide essential skills?
– Reforms initiated by the state?
– Lacking autonomy of VET institutions to provide education?

75. Some points on VET in the BS (Saar et al. 2008)
•Developments in the post-Soviet time:
– Curricula of VET courses were broadened
– The introduction of new post-secondary vocational education
programmes and the emergence of private institutions
– Vocational education increasingly moved from enterprises to
vocational schools
– However, weak links between the education system and labour
markets persist -> does not guarantee smooth school-to-work
transitions
– Moving away from the model of regulated inclusion,
characteristic of occupational labour market (e.g. Germany),
toward the competitive labour market entry pattern, characteristic
of the flexible labour markets of the USA (especially Estonia)

76. As a conclusion,
•Nölke’s and Vliegenthart’s (2009, 678) notion of
‘dependent market economies’ – which the Baltic States are
examples of – paints a gloomy picture of the BS’ future:
– Foreign direct investment (FDI) into these countries pays off with
rather low labour costs and with considerable tax breaks
– Transnational companies (TNCs) are not in favour of generous
public education system, neither of their own substantial
investment into their own labour force
– What is more, TNCs do not any point in investing in innovation-
relevant skills -> they prefer to transfer innovations to the region
from abroad
– Effective training institutions require national (or at least sectoral)
coordination within inter-firm networks and associations, which
would require CME-style system of vocational training; in the
CEES, however, industrial relations tend to be company-based

77. THE ROLE OF TRADE UNIONS

78. Industrial relations in the Baltic States
• There is a vast difference between the Baltic and Nordic
countries when it comes to industrial relations
•Unionisation rates have decreased steadily from almost
one hundred to around in twenty years of transition
•Collective bargaining is relatively uncommon in Baltic
workplaces: around one quarter of workers were covered
by collective agreements in the beginning of the 2000s
•Collective agreements often formal in nature, negotiated at
company rather than sectoral or national level
•Majority of trade union membership is concentrated in the
public sector (as elsewhere in Eastern Europe)

79. Workers’ acquiescence
= silence, quietness (with regard to employee voice)
•The post-socialist labour process is characterised by
salience of the acquiescent worker, who is not joining
unions and who is expressing little visible resistance to poor
labour conditions
•Acquiescence of labour can be noticed in the small
number of strike days or the number of employees
participated in the major strikes in the CEE countries
(Woolfson & Beck 2004, 248)

80. Strike statistics (ILO, Lithuanian Statistics)
Estonia 2000 2003 2004 2005 2006 2007 2008
No. of strikes &
warning strikes
0 1 1 0 1 2 1
Persons
involved
0 13,260 n.a 0 60 500 400
Lithuania 2000 2001 2005 2007 2008 2012 2014
No. of strikes &
warning strikes
56 34 1 161 112 193 78
Persons
involved
3,303 1,703 70 7,033 7,961 5,558 1,591
Latvia 2000 2003 2004 2005 2006 2007 2008
No. of strikes &
warning strikes
n.a n.a n.a 0 0 0 14
Persons
involved
n.a n.a n.a 0 0 0 812

81. The case of Estonia
Estonian sociologist Andrus Saare argued that
Estonians tend to pull out from defending their
rights, which is contrary to what other Europeans
do; he took Finland as an example country in which
people dare to express their opinions in different
ways; this is due to a longer history of
independence and democracy in Finland
(Postimees 19.10.2010)

82. Vilnius 16 January 2009: protesters gather outside parliament

83. Muted voices
Barefoot policement: the
nation is in danger!
Silenced protester

84. More ’exit’ than ’voice’ (Woolfson 2011)?
•‘Double failure’ of ‘voice’
– organised social dialogue/protest
– muted ‘discourses of discontent’
•Systemic ‘shock’ / end of ‘loyalty’
•Renewed migratory ‘exit’ (silent protest)
•‘Internal exit’ (populism and xenophobia?)

85. Industrial relations in Central Asia: the case of Kyrgyzstan (Sippola
2014)
•Overall trade union membership 30 %
•Collective bargaining agreements mostly cover public
sector
•Delayed/unpaid wages due to firms’ mismanagement
and/or lack of liquidity
•Regular and major violations of workers’ rights
– Massive transfers from permanent to temporary work
– Violations of workers’ rights in the governmental sector
– Illegal employment of undocumented workers or involvement
in the grey sector of the economy

86. Major attacks to trade unions (Sippola 2014)
•In 2012, the Kyrgyz government made a decision to
terminate the operation of the Workers’ Health
Foundation
– Considered to be a ‘burden’ on employers
•In 2014, a draft law denying workers in ‘strategic’
sectors the right to strike
– A company can be considered strategic if it generates two
percent of the country’s GDP
– The International Trade Union Institution has voiced its
concern over the intended restrictions on the right to strike

87. Trade unions in Russia
•In terms of membership, Russia might be capable of
providing an exception to the rule of post-communist union
weakness
– In 2005 union density was 46 % -> downward trend
– cmp. China, where it is 30-35 % -> upward trend
•Common attitude: “we have no trade union”, trade unions
are “sham organisations” making the leadership rich and
average person poor (Davis 2006, 207)
•Main trade union federations: FNPR and the ‘alternative’
unions
•The 2002 Labour Code besides de facto prohibited striking
at workplaces, also set restrictions to collective agreement
and deprived the union the veto in the case of firing of
employees

88. Three roles of trade unions in Russia
1. Providers of social goods
2. Social partners
3. A counter-weight to the employer (real defenders of
workers’ interests)
-> none of these clearly dominating, although the role of
social partner perceived as the most desired by the
employers and trade union representatives
-> Russian conception of social partnership deviates from the
European conception
– FNPR has sought direct political participation but has not been
involved in negotiations via social partnership institutions such
as tripartite and bipartite commissions
– Closer parallels found in Argentina, Brazil and Mexico, where
state is the most powerful actor in industrial relations

89. How do Russian
trade unions
address migrant
workers’ rights?
The case of the
’Eastern Space
Station’

90. SEGMENTATION OF LABOUR

91. Labour market segmentation
• Can occur geographically between regions, functionally
based on the division of labour or organisation-wise within
a company
• An antithesis to neoclassical economic theory that
emphasises equilibrium principle of the labour market
drawing upon the law on supply and demand
(convergence)
• The division of jobs into core and
periphery segments and their
intermediaries (e.g. Doeringer &
Piore 1971; Nätti 1989)

92. What is measured, when one measures labour market
segmentation?
• Insecurity
• Wage
• Other labour conditions
On which basis segmentation occurs (Doeringer & Piore
1971; Nätti 1989)?
1. skill
2. gender
3. age
4. social class
5. ethnic background
-> skilled, white men typically in the core

93. Michael Piore’s theses (Birds of Passage: Migrant
Labor and Industrial Societies, 1979)
• Migrants do not come on their own but are recruited by in the
rich countries
• Migrants intend to come only for limited stays, save their
money, and then return to home
-> Permanent settlement and acculturation are an evidence their
failed intentions
• Industry recruits foreign workers to do work that the natives
will not to do
-> This is the result of two complementary dualities: 1) secure,
unionised labour vs. transient labour, 2) large, monopolistic
industries vs. small enterprises

94. Piorean theses (continued)
• More recent migrants with lower subjective expectations,
less language skills and a more limited understanding of
the labour market have more instrumental attitude
towards work rather than the ethos of ’job for life’
• As people develop a more permanent attachment, their
time horizon expands and instability of employment is
no longer a matter of indifference
-> I would argue that besides the ’expansion of time
horizon’ also changes in family situation (family etc.) will
have a similar effect

95. Skills-based segmentation the Russian labour market (Grosfeld et
al. 2000)
• In the beginning of the 1990s, enterprises offered their
employees an “agreement” that combines low wages with
social security
• The employees either a) accepted the agreement and
received social security in exchange for that or b) they
remained on the mercy of “free” labour market (in case they
had special skills)
-> this led to dualism in the labour market based on skills:
1. The most productive employees were employed in the
“competitive” segment of the labour market
2. Less productive employees were left in the less competitive
segment of the labour market

96. Gender-based segmentation in the Russian labour market
• In the Soviet Union, women were ‘ghettoized’ in low-paid
undesirable employment, and this trend continued in the
post-Soviet time (Ashwin & Bowers 1997, 33)
• Soviet ideology promoted the image of the working wife and
mother, in the post-Soviet context official rhetoric and media
often promote images of the model housewife (White 2005,
430). What is more (ibid.):
– employers in the new private sector discriminate against
women
– in a national survey 2002, most respondents believed sex
discrimination exist in Russia
– another 2002 survey showed 2/3 of women graduates
believed that male graduates had better chances in the labour
market

97. Gender-based segmentation (cont’d)
• Global Gender Pay Gap Map:
http://www.movehub.com/blog/global-gender-pay-gap-map
• Gender wage gap: women paid 32.8 % less than men (ILO):
http://www.themoscowtimes.com/article.php?id=512607
• Gender roles are still well established:
http://www.gazeta.ru/energetic_dfo/2015/02/26_a_6427537.shtm
l

98. Regional and ownership-based segmentation of labour (OECD 2011,
54-57)
• The regional differences in wages originate in a) differences
in living costs, b) extra payments due to working in Nordic
regions and exhausting work, c) uneven unemployment
situation between regions (Moscow vs. Chechnya-Ingushetia)
• The wages in the municipality sector in 2007 were 62 % of
the average, in international joint ventures188 % of the
average
• Regional differences are getting narrower (this was the
situation in 2011, but the 2014-2015 crisis might have
escalated negative development again)

99. The realisation of Piorean scenario in the context of labour migration from Central Asia to Russia
• Observer at RIA Novosti, Vadim Dubnov (2013), regards
Central Asian migration to Russia as analogous of Algerians to
France and Mexicans to the United States
•Only those Armenians, Belorussians, Moldovans and
Ukrainians, who are not capable of moving to the West, will opt
for Russia (ibid.)
•The formation of ethno-cultural enclaves likely when majority of
labour migrants are from culturally distant societies of Central
Asia (Rodionov 2014)
•Rodionov (journalist) sees the restriction of Central Asian
immigration flows as a solution to the problem

100. The social origins of emigration decisions (Reeves 2012):
• Reeves – in the line with M. Piore (1979) – criticizes the
way motivations for migration are explored in terms of
rational individual responses to economic necessity, thus
ignoring the social embededness of economic decisions
The tendency to characterize Russia as “absorbing the surplus
(especially male) labor from the Caucasus and the Central
Asian states,” as one analyst recently argued, elides the fact
that there are historical and political reasons why labor in these
areas is in “surplus,” just as there are political reasons why
Central Asian labor in Russia is overwhelmingly unregulated,
uncontracted, and therefore cheap.