Official says staff cuts possible at many Russian companies

MOSCOW, Feb 12 (PRIME) -- Russia’s Economic Development Ministry does not rule out staff cuts at a great number of companies, Deputy Minister Oleg Fomichyov told reporters Friday.

The ministry has no concrete forecasts for increase of unemployment in 2016, he said. “We see risks, as production in many sectors contracted last year…We think that a significant amount of companies may just change their behavior and begin firing employees. So, we need a reserve in the budget to compensate these risks,” he said.

The ministry’s baseline scenario for development of the country’s economy, calculated at an average annual oil price of U.S. $50 per barrel, envisages unemployment of 5.8% in 2016. Earlier on Friday, Fomichyov told the State Duma, the parliament’s lower house, that risks for growth of unemployment are higher in 2016 than a year ago, but the government plans to prolong its regional employment support programs.

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