Skills shortages and training in Russian enterprises

In the transition to a market economy, the Russian workforce underwent a wrenching period of change, with excess supply of some industrial skills coexisting with reports of skills shortages by many enterprises. This paper uses data from the Russia Competitiveness and Investment Climate Survey and related local research to gain insight into the changing supply and demand for skills over time, and the potential reasons for reported staffing problems and skills shortages, including labor turnover, compensation policies, and the inhibiting effects of labor regulations. It discusses in-service training as an enterprise strategy for meeting staffing and skills needs, and presents evidence on the distribution, intensity, and determinants of in-service training in Russia. It investigates the productivity and wage outcomes of in-service training, and the supportive role of training in firms'research and development and innovative activities. A final section concludes with some policy implications of the findings.Education For All,Access&Equity in Basic Education,Labor Markets,Primary Education,Teaching and Learning

A comparison of Russia and Slovenia

Ownership is determined by firm specific factors and the environment. Firms change over their life-cycle. The governance cycle – here defined as changes in identity of the dominant owner and own-ership concentration - is marked by key phases including start-up, growth, and possibly a restructur-ing or exit stage. During transition the cycle reflects: privatization often with a high proportion of employee ownership like in Russia and in Slovenia; strong pressures for restructuring and owner-ship changes; limited possibility for external finance because of embryonic development of the fi-nancial system. To provide simple hypothesis tests, we use Russian enterprise data for 1995-2003 and Slovenian data covering 1998-2003. In spite of differences in institutional development, con-cerning privatization and development of corporate governance institutions, we find that govern-ance cycles are broadly similar in the two countries. Employee ownership is rapidly fading, but while change to manager and non-financial domestic outsider ownership is typical for Russia, man-ager ownership is not widespread in Slovenia. Instead change to financial outsiders in the form of Privatization Investment Funds is frequent. Foreign ownership, which is rare especially in Russia, is quite stable. The ownership diversification to employees and diversified external owners during privatization did not fit well to the low development of institutions. As expected we observe in both countries a subsequent concentration of ownership on managers, external domestic and foreign owners. JEL-codes: G3, J5, P2, P3 - Keywords: corporate governance, life-cycle, privatization, ownership change, transition economies, Russia and Slovenia

Performance of closely held firms in Russia: evidence from firm-level data

This paper evaluates the impact of ownership concentration on firm performance in a weak institutional environment. Specifically, using new survey evidence, we seek to appraise quantitatively the performance of block-holder-controlled firms in Russia and to identify, within the domain of corporate governance theory, factors that may explain such performance. We find evidence of negative association between the size of the dominant owners' shareholding and performance parameters such as investment, capacity utilization, and profitability. At the same time, we establish that control structures with multiple, large shareholders increase efficiency. The ambiguity of the effects of ownership concentration suggests that country-specific factors play an important role

Employment Protection Legislation in Russia: Regional Enforcement and Labor Market Outcomes

The efficiency of the labor market critically depends on the design of its institutions, including employment protection legislation. However, since formal laws can be observed to varying degrees, the actual enforcement regime shapes incentives and constraints. Most of the studies exploring the effects of employment protection on labor market performance implicitly assume that compliance is near to complete. However, if enforcement varies widely across regions/cities or segments of firms, then this variation may cause variation in performance. This paper, looking at Russia, explores whether cross-regional and inter-temporal variation in enforcement of employment protection laws is significant and is translated into regional labor market outcomes. The paper utilizes a unique data set based on State Labor Inspectorate data and Supreme Court statistics.

Diversity within capitalism: the Russian labour market model

Purpose – The purpose of this paper is to investigate labour market practices in a transition economy in relation to broader institutional configurations. Design/methodology/approach – Through a review of relevant literature and the analysis of statistical data the paper reveals some specific factors influencing labour market practices in a transition economy. Findings – The paper establishes a link between inefficient enforcement and the emergence of compensating institutional arrangements on the one side and the unusually broad implementation of flexible working time and flexible pay on the other as a crucial factor that made the stabilization of employment in Russia possible. Originality/value – The paper reveals how a formal regulatory system, which on the face of it is similar to what is a norm in the majority of European countries, may coexist with a distinctive labour market model and explores issues of relevance to academics, researching in the field, policy-makers, human resource managers, employers and employees

The effects of ownership concentration on investment and performance in privatized firms in Russia

This paper provides new survey evidence on effects of concentrated ownership on restructuring and performance in privatized firms in Russia. The major findings are that large-block shareholding is negatively associated with the firm's investment and performance, and this relationship does not depend on the identity of controlling shareholders. These results are consistent with the assumption that when minority shareholders' rights are not adequately protected, the entrenched controlling shareholders may be engaged in extracting 'control premium' before pro rata distribution of dividends. The issues raised have relevance to other transitional economies where the privatization process has been followed by an increase in ownership concentration. Copyright © 2001 John Wiley & Sons, Ltd.