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CORONA sur, or the irreversible transformation of human resources in the era of pandemic cataclysms

Olga Bantsekina (Chief Representative, Coleman Services)

Is there any person in this world who hasn’t at least once ranted about the difficulties that this year has brought? It seems that everything that could go wrong has (and will again, apparently), everything we’ve managed to steer clear of over the last few decades. We are scared to live, we have to learn to save our energy, and we are surrounded by so many problems it is hard not to think that we are all slowly going crazy...

However, life keeps going, albeit in a new, weird manner, and we all manage to adapt to its unfamiliar, surreal flow.

In spite of all the troubles of this year and its losses, both past and future, HR (as always) remains on the front line of relations between the market economy and individual people. HR keeps overcoming the obstacles and barriers set by the state and the government. Every day, they find ways to support businesses with great professionals and provide care and motivation for the workers. It seems like it’s all coming from the business, but in fact, it comes from the depths of HR’s kind and warm hearts.

Today, we will try discussing this year’s key trends in the Russian labor market. The twists and turns of this troubled year could not help but leave a deep imprint on our sector of the economy and on everyone’s lives.

According to the official statistics of the Russian Research Institute of Labor, in August, the unemployment rate grew by up to 6.4%, compared to 6.3% in July, 6.2% in June, 6.1% in May, 5.8% in April, and 4.7% in March. The last time the unemployment rate in Russia exceeded 6% was in March 2012 (then it reached 6.5%). It was exactly 6% in March 2016 and January 2013.

Experts predict that it will only keep rising until December, when the curve will flatten, and will then start going down from next year. The number of registered unemployed people in Russia can potentially reach 5.3 million people (according to the Institute for Social Policy at the HSE). The authors of the study see the explanation for this increase in official unemployment in the economy’s forced downtime, the simplification of the registration procedure, and the increase in the amount of welfare benefits.

It is obvious the lockdown and self-isolation regime took the biggest toll on such industries as tourism, air transport, hospitality, the restaurant business, and the service sector. However, according to data from hh.ru, this year there was no significant rise in new resumes or applications in response to the decline in vacancies, which is what makes the COVID crisis different from those that came before it. The experts at HeadHunter believe the decreased activity among applicants (38% lower than in April) is connected to a general panic and the uncertainty of even the nearest future. After the lockdown was canceled, applicants became as active as they were before it.

The labor market in Russia is trying to restore itself after the spring crash but it still has a long way to go before it reaches pre-crisis levels. Sberindex.ru calculated that the total payroll funds paid in August are only 1.1% of the trend at the start of 2020. This is a significant improvement from the peak of -7.6% in May, but the moderate negative impact of the pandemic remains.

At the same time, we can already say that a whole number of changes that have affected our professional life are apparently here to stay. 71% of companies (as surveyed by Coleman Services for the Current Goals of HR poll, July 2020) reported changes in their development plans (including some changes to HR processes that they have already put into practice or are preparing to implement in the near future).

As of now, most companies have switched to working from home, partially or completely, and are planning to keep working in this format to a greater or less degree, at least until the end of the year. Most employees are happy with the format of working from home and do not have any difficulties with it. That is why they push for continuing to work in a flexible, remote format on a permanent basis. Business also have a generally positive response to this change. Many companies have noticed that working from home is beneficial for them, and some are considering retaining the opportunity for their employees to work from home partially or full-time in the future. It looks like the trend of working from home is going to become less of a forced measure and more of a standard practice that will allow companies to save money on rent of office space, lunches, and commuting, and while employees find a better work-life balance thanks to this measure.

The transition to working remotely has allowed employers to take a closer look at applicants from other regions of Russia. And it doesn’t apply just to the IT industry, where remote work has long been the norm. Today, employers headquartered in Moscow actively hire applicants from other cities to work from home. On the one hand, employers have realized the benefit of lowering the direct costs of labor; on the other, remote work turned out to be a great alternative to relocation for professionals living in the regions, many of whom were not prepared to relocate. Thus, the pandemic has overturned the longstanding bothersome trend of low personnel mobility within the country, even if it is happening online.

The number of business trips taken has reduced, which is understandable given the lockdown, but most of our respondents said they weren’t going back to their normal business trip schedule after this is all over. The pandemic has demonstrated that meeting online is as efficient as in-person, and besides, it is much cheaper.

The recruitment market has significantly sunk and is unlikely to reach pre-pandemic rates before the end of the year. The results of the survey taken by Coleman Services show that 28% of companies have significantly reduced their hiring plans, and 21% have completely put them on hold. Nevertheless, some companies continue to hire. For example, in such areas as FMCG, logistics, and the high-tech, chemical and fuel industries.

The majority (over 50%) of respondents that took part in the Coleman Services survey (Current Goals for HR, 07/’20) have mentioned that their HR services have undergone significant changes and optimization of processes: abandoning traditional formats and going online resulted in better communication within the team.

Another highly relevant topic in the survey was the optimization of work with service providers. Companies are ready to consider outsourcing a part of non-profile functions and spending more money on complex personnel solutions for tasks that are hard to do or cannot be done using only in-house resources (accounting and auditor services, cleaning, administrative and utility functions, training, IT, logistics, etc.).

This year has brought a lot of things that have drastically changed both our personal and professional life. Life as we knew it will probably never return, but we must do our best to turn these challenges into opportunities that will help us overcome all obstacles and succeed in business. Business is impossible without HR. So let us adapt and act boldly, just as we always do!

Association of European Businesses Quarterly Magazine, december 2020.

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