Russian study shows scale of job and wage cuts if lockdown continues

Russia-based R&C Market Research Company has conducted a study into the impact of Covid-19 on the Russian event industry. The results reveal potential losses to the sector of US$1.55bn if the industry can’t get up and running in 2020. The research was carried out jointly by the Russian Convention Bureau, the Russian Union of Exhibitions and Fairs and the Union of Exhibition Developers, with the support of the Roscongress Fund. The research is the product of analysis of information in the public domain as well as of an opinion survey of 245 leading companies in the industry, including exhibition organisers and other events providers. The sample accounted for 12% of the total number of active market players. Russia’s event industry, together with tourism, was the first to suffer from the impact of the Covid-19 pandemic and companies, like in other countries, have been forced to cancel and postpone events. The study reviewed various scenarios of the industry’s further development. With restrictions on holding events and other forms of social activity continuing through May in Russia, the sector is predicted to be in for a period of low activity and highly unlikely to achieve pre-crisis levels anytime soon. In the event of the restrictions being extended for a longer period of time, however, the losses likely to be incurred by the industry could exceed R110bn (US$1.55bn) with up to half of all jobs in the sector being lost. Market experts project that, whatever the scenario, it would take at least six months for the events industry to recover in Russia. http://rnc-consult.ru/ Over half of companies (54%) said they had maintained they staff’s salaries through to the end of April; while 20% of companies had cut pay by up to 35%. Over a quarter (26%) had cut pay by more than 35%. Forty-four percent of companies projected their average losses to the end of April at between 11-30%, while 21% put the losses at over 50% of normal numbers. With the lockdown continuing to June, 39% of companies are now projecting staff cuts of no more than 10%; while 31% of survey respondents believe job cuts of between 11-35% will be necessary. Around 30% of firms thought even deeper cuts would be required. In the June scenario 53% of companies were predicting wage cuts of 36% or more, with 26% of companies being in the range of 11-35% for salary reductions and 22% either maintaining salary levels or reducing by 10% or less. In a third scenario, where lockdown continues to the end of the year, Russia could see 59% of its event companies cutting staff levels by over half and a further 13% by between 36 and 50%. The full study (in Russian only) is available here