The Human Capital Multidisciplinary Research Center Showed the Impact of Demographic Aging of the Population on Labour Supply in Russia

In Russia, as in many other countries, the trend towards depopulation and demographic aging is already accompanied by a decline in the working-age population. This is the conclusion reached by scientists from the Higher School of Economics in the tenth scientific digest “Demographic Changes and Labor Supply in Russian Regions”. The issue was prepared by the Human Capital Multidisciplinary Research Center.

Like most developed countries, the Russian Federation is undergoing significant changes in the nature and consequences of changes in the size and composition of the population. As a result of the decline in the birth rate, each subsequent generation of children, on average, is smaller than the generation of parents. The labor force will inevitably age, and this is a very serious challenge to the Russian economy, write the authors of the digest, scientists from the Center Mikhail Denisenko and Nikita Mkrtchyan.

According to the average version of the population forecast made at the Institute of Demography, the population of Russia aged 20 to 59 will decrease by about 2.6 million people from 2022 to 2030. At the same time, the number of people aged 20-39 will decrease by 6.6 million, and those aged 40-59 will increase by 4.0 million. Obviously, such quantitative transformations will have a significant impact on the country's economy as a whole, and the labor market in particular. . However, the labor force will decrease by about 1.2 million by 2030. This trend is slowed down by the increase in the retirement age, but at the same time it reinforces another trend - the aging of the workforce. If in the early 2020s the share of people aged 40 and over among the employed and unemployed in Russia was 52%, by 2030 it will increase by about another 10 percentage points. By the mid-2030s, the situation will improve due to the entry into working age of numerous generations born in 2007-2015.

An increase in the number of labor force is expected according to all forecast options in the Moscow and St. Petersburg metropolitan regions, in the North Caucasus. The greatest decline is expected in the regions of the Volga region. The supply of labor force in the economy will increase due to international temporary labor migration, it will most strongly affect the capital regions, as well as in the Urals and the Far East. The labor force is redistributed as a result of internal labor migration, also in favor of Moscow and the resource-rich regions of the country.

The process of aging of the labor force covers all regions of the country, but in regions that manage to maintain the migration influx of young able-bodied population, this process will be significantly mitigated.

NCMU Scientific Digest Project managed by Olga Voron.

Digest No. 10 is available via the link.