Russia's Unemployment Rate Hits All-Time Low Of 5.2% - Or Does It?

December 12, 2012 - 9:13 AM

The unemployment rate in Russia has hit an all-time low of 5.2%, according to Deputy Prime Minister for Social Policies, Olga Golodets.

Golodets said on Tuesday:

"Today we have registered an unprecedented low unemployment level of 5.2% calculated using International Labor Organization methodology. Russia has never before achieved this level in its history and we are proud of this."

Despite Ms. Golodets comments, there is skepticism about the accuracy of the numbers.

According to RT.com, data shows the real unemployment rate in Russia could be more than three times higher than the official number, with one poll reporting unemployment among women at 22% and 19% among men.

The 5.2% official unemployment rate in Russia is lower than the 7.7% rate in the United States and the 11.7% rate in the Eurozone.

Golodets said that Russia has huge potential for job creation but also admitted that there are challenges ahead, particularly for young people.

"The Russian economy has substantial potential. We have a great advantage compared to European countries because the European Union has virtually used up its possibilities for job creation."

At the same time, problems still exist in the Russian labor market, she said.

"It is difficult for young people to find employment after university. If we use proper strategies to build bridges on the labor market for those categories who really find difficulty with employment, then we can say we are capable of ensuring employment for the overwhelming majority of Russian citizens."

So, is 5.2% accurate?  Who knows?

At least, in the U.S., we've developed a methodology to getting to a lower unemployment rate: don't count individuals who have given up looking for work.  By removing these individuals from the labor force we can artificially adjust the rate lower - and justify doing it.

In Russia, however, it appears one simply needs to blurt out a number for it to be official.

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