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Are Skills a Constraint on Firms? New Evidence from Russia

Author

Listed:
  • Commander, Simon

    (IE Business School, Altura Partners)

  • Denisova, Irina

    (CEFIR, New Economic School, Moscow)

Abstract

The paper uses a unique survey of recruitment firms to look at how Russian firms perceive the supply of skills in the labour market and how well those skills match to their demand for labour. Firms invest significant amounts of time in search to fill vacancies and search time is unambiguously increasing in skills. These skill gaps are associated with significant wage premia and are perceived to have negative consequences for the output mix and productivity. A small job postings experiment also finds that search time increased yet further for activities considered relatively innovative. Further, using Russian Ministry of Labour data for all legal migrant applications in 2010 and matching the migrant to the sponsoring firm, we find that there is some – albeit limited - evidence of firms using migrants to address high skill shortages. However, the overwhelming majority of migrants are skilled or unskilled workers; a reflection of the low underlying rates of innovation and associated demand for high skill jobs.

Suggested Citation

  • Commander, Simon & Denisova, Irina, 2012. "Are Skills a Constraint on Firms? New Evidence from Russia," IZA Discussion Papers 7041, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp7041
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    Citations

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    Cited by:

    1. Vakulenko, Elena & Leukhin, Roman, 2015. "Investigation of demand for the foreign workforce in Russian regions using applications for quotas," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 37(1), pages 67-86.
    2. Vakulenko, Elena (Вакуленко, Елена) & Leukhin, Roman (Леухин, Роман), 2016. "Whether the foreign workers are discriminated in the Russian labor market? [Дискриминируются Ли Иностранные Работники На Российском Рынке Труда?]," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 1, pages 121-142, February.
    3. Polyakova, Evgeniya & Smirnykh, Larisa, 2016. "The earning differential between natives and individuals with immigrant background in Russia: The role of ethnicity," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 43, pages 52-72.
    4. Smirnykh, L. & Polaykova, E., 2020. "Income and the integration of migrants in the Russian labour market," Journal of the New Economic Association, New Economic Association, vol. 47(3), pages 84-104.
    5. Lilas Demmou & Andreas Wörgötter, 2015. "Boosting Productivity in Russia: Skills, Education and Innovation," OECD Economics Department Working Papers 1189, OECD Publishing.
    6. Vakulenko, Elena & Leukhin, Roman, 2017. "Wage discrimination against foreign workers in Russia," Russian Journal of Economics, Elsevier, vol. 3(1), pages 83-100.

    More about this item

    Keywords

    job search; vacancies; skills;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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