Russian companies broadening their geographical hiring horizons

Russian companies broadening their geographical hiring horizons

While the COVID-19 pandemic is affecting Russia’s job market negatively by hindering overall economic activity and spurring unemployment, it is also offering new opportunities. Widespread use of remote working and government regulations’ overhaul prompted top Russian employers to hire more staff from the country’s regions.

The pandemic’s enforced shift to remote working has unlocked the opportunity for many Russian recruiters to tap far more of the country’s 145-million population, says Financial Times. The number of people working remotely is rapidly rising in many countries, but the impact on Russia’s employment market seems to be one of the most significant. According to the Organisation for Economic Co-operation and Development, 54% of Russian adults have tertiary education, which is the second-highest level among the organisation’s members and partner countries. However, before the pandemic, many people were cut out of big corporates’ potential hiring pools unless they emigrated to Moscow or another large city.

The lockdown has not only pushed companies into remote working but also stimulated an overhaul of outdated government regulations making regional hiring far easier. Earlier this year, a physical “employment record book” that had been mandatory since the Soviet era was permitted to be replaced by a digital version. Besides, digital signatures are now legally recognised on documents.

These changes were critical in allowing key employers to broaden their geographical hiring horizons, says CEO of Alfa-Bank Vladimir Verkhoshinskiy. “We can hire people online. We can train people online. We can fire people online. Beforehand, all that would have been impossible.” Earlier, his bank hired programmers, IT developers and data scientists only from five cities where it has large offices. However, two-thirds of this year’s recruits are from places outside those cities, and many of them were recruited without meeting a human resources manager from the bank in person. For example, only two of 50 employees of the bank’s new call centre nominally based in a small city in southern Russia work from office.

Many of Alfa-Bank’s new recruits were hired without meeting a human resources manager from the bank in person. Photo: Dmitry Koshelev

Shifting jobs out of Moscow brings serious economic benefits for employers, as monthly salary in the capital is roughly 80% higher than the national average. “Of course, we also save money,” says Verkhoshinskiy adding that it is a win-win situation. The unemployment rate in the regions is also significantly higher compared to Moscow and St Petersburg.

Other Moscow-based companies have also switched to regions in their search for new hires. Russia’s largest food retail group X5 has hired 15% of its new employees from the country’s regions this year. According to the retailer’s spokesperson Denis Kuznetsov, the company turned its attention to the regions, as Moscow had a finite number of IT professionals. X5 expects the share of regional workers to grow in the future. Tinkoff set up virtual development hubs in southern Russia and Siberia even before the pandemic to attract developers who generally prefer to work remotely.

“Several [Russian] companies have already announced plans to shift to a hybrid or completely remote working model after the pandemic,” commented Semyon Yakovlev, senior partner at McKinsey & Co in Russia. “Turning remote working into a competitive advantage involves quite a few components, and designing an effective structure and instilling a caring culture may be as important as harnessing the power of technology.”

By Litvina Anna