By Gleb Bryanski
MOSCOW, Dec 10 (Reuters) - The Russian government decided on Thursday to cut budget handouts for fighting unemployment next year and ignored a plea from the regions for more money in a sign that mass layoffs worries are receding.
'In 2009 on the whole we have managed to calm the situation on the labour market. Our efforts, although not in every aspect, but nevertheless yielded positive results,' Putin told a government meeting.
Russia is set to post its first annual economic contraction in a decade this year, and some 5.8 million people are currently unemployed, about 40 percent more than before the global economic crisis hit the country in mid-2008.
Although the economy is starting to show its first signs of recovery, officials warn that the path will be a long and slow one, and further rises in joblessness are possible.
'In such an environment we have decided to continue to support the labour market in 2010,' Putin said.
'But since the situation has changed, we will change the emphasis (of these measures). A formation of a flexible and efficient labour market will move to the foreground,' he added.
The government said in a statement that it plans to spend 36.3 billion roubles ($1.19 billion) on measures to stem a rise in unemployment in 2010 although the regions were asking for 62.3 billion roubles.
The federal budget funds will complement the cash allocated on a regional level, and will go to projects such as public works, re-training, relocation assistance and small-business support.
This year, Russia has allocated 43.7 billion roubles from the federal budget to subsidise regional jobs programmes, but only 31.7 billion has been spent so far, helping 2.2 million people, the government said.
Critics say that the measures have improved the registered unemployment statistics, which are quoted by officials, but that figures calculated based on World Labour Organisation methodology are less rosy.
They also argue that the government's determination to keep people employed at any cost to maintain social stability has undermined regional budgets and prevented firms from slashing their expenses.
'Of course we understand well that questions about the quality of these jobs are fully justified. But I repeat, it is a temporary solution at a time of an acute economic crisis,' Putin said.
Some state companies, which along with the public sector are the main employers in Russia, have announced plans to cut staff. Many plants in monotowns, which rely on one company for most of their jobs, are under pressure to keep their headcount.
The government said it expects the measures to help create 1.2 million new jobs in 2010 and re-train 342,000 people. It said that struggling car maker AvtoVAZ may still require some additional measures.
(Writing by Gleb Bryanski, Editing by Chizu Nomiyama) Keywords: RUSSIA UNEMPLOYMENT/ (gleb.bryanski@reuters.com ; +7 495 775 1242; Reuters Messaging: gleb.bryanski.reuters.com@reuters.net ) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
MOSCOW, Dec 10 (Reuters) - The Russian government decided on Thursday to cut budget handouts for fighting unemployment next year and ignored a plea from the regions for more money in a sign that mass layoffs worries are receding.
'In 2009 on the whole we have managed to calm the situation on the labour market. Our efforts, although not in every aspect, but nevertheless yielded positive results,' Putin told a government meeting.
Russia is set to post its first annual economic contraction in a decade this year, and some 5.8 million people are currently unemployed, about 40 percent more than before the global economic crisis hit the country in mid-2008.
Although the economy is starting to show its first signs of recovery, officials warn that the path will be a long and slow one, and further rises in joblessness are possible.
'In such an environment we have decided to continue to support the labour market in 2010,' Putin said.
'But since the situation has changed, we will change the emphasis (of these measures). A formation of a flexible and efficient labour market will move to the foreground,' he added.
The government said in a statement that it plans to spend 36.3 billion roubles ($1.19 billion) on measures to stem a rise in unemployment in 2010 although the regions were asking for 62.3 billion roubles.
The federal budget funds will complement the cash allocated on a regional level, and will go to projects such as public works, re-training, relocation assistance and small-business support.
This year, Russia has allocated 43.7 billion roubles from the federal budget to subsidise regional jobs programmes, but only 31.7 billion has been spent so far, helping 2.2 million people, the government said.
Critics say that the measures have improved the registered unemployment statistics, which are quoted by officials, but that figures calculated based on World Labour Organisation methodology are less rosy.
They also argue that the government's determination to keep people employed at any cost to maintain social stability has undermined regional budgets and prevented firms from slashing their expenses.
'Of course we understand well that questions about the quality of these jobs are fully justified. But I repeat, it is a temporary solution at a time of an acute economic crisis,' Putin said.
Some state companies, which along with the public sector are the main employers in Russia, have announced plans to cut staff. Many plants in monotowns, which rely on one company for most of their jobs, are under pressure to keep their headcount.
The government said it expects the measures to help create 1.2 million new jobs in 2010 and re-train 342,000 people. It said that struggling car maker AvtoVAZ may still require some additional measures.
(Writing by Gleb Bryanski, Editing by Chizu Nomiyama) Keywords: RUSSIA UNEMPLOYMENT/ (gleb.bryanski@reuters.com ; +7 495 775 1242; Reuters Messaging: gleb.bryanski.reuters.com@reuters.net ) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.