Staff cuts unlikely to help to save costs of enterprises

According to Belstat, in May 2017 Belarusian enterprises laid off 14,400 people on a net basis and payroll increased by 2% as compared with April 2017. The record number of layoffs for 2017 was due to a seasonal factor. Layoffs are likely to persist and wages to increase for the remaining employees. In some economic sectors wages would grow due to the administrative pressure, for instance, in the public sector. A slight decline in oil prices could slow down the pace of economic growth and the wage growth. Wage growth outpaces layoffs, hence, should this trend persist in 2017, enterprises costs on wages would go up, reducing their modernisation capacity.