High salaries in Moscow compared with the rest of the country are nothing new. Since a majority of the cash flowing through Russia has always traveled through the capital, high-earning positions have always been a part of life here. But now the situation is extremely bright. Experts report that salaries for professionals are on the rise, and companies are turning away from using expensive foreign experts when Russians can do the same job for less.

Putting a price on professionalism

High salaries in Moscow, compared with the rest of the country, are nothing new. Since a majority of cash flowing through Russia has always traveled through the capital, high-earning positions have been more common here than in the rest of the country for a long time. And today, the outlook is extremely bright. Experts report that salaries for professionals are on the rise, and companies are turning away from using expensive foreign experts when Russians can do the same job for less.

“The growth in salaries for managers right now is very good, up 20-21 percent from the first half of 2001,” says Yulya Denisova, manager for the salary-survey project at ANCOR, a Russian recruitment agency. Her company conducted a survey of 55 Russian and foreign companies and found that salaries for professionals are growing fast.
She attributes the high salaries to the overall growth in the Russian economy, where GDP enjoyed a 5 percent growth rate last year. But Denisova was hesitant to estimate whether wages will continue to rise. “Things will either stabilize, or continue to improve slightly, but this is Russia, so it’s hard to say what will happen,” she said.

She also pointed out that the sudden jump is not due exclusively to economic growth. “Salaries dropped a year ago, as companies switched from paying employees in ‘black’ [unreported] to ‘white’ money in anticipation of the new tax code that took effect last July.” She says this resulted in a large dip in pay, followed by a sudden increase. However, the most positive sign is that salaries have almost reached pre-crisis levels, especially for top managers, she said.

According to the survey, salaries for top- and middle-management positions average about $3,000 a month, while other experts, such as network specialists, average much lower, at roughly $900 a month.

Salaries differ according to the amount of responsibility management positions entail, according to Alyona Sedenek of Triza International Search Group, a recruitment company. “Salaries depend not only on the size of the company, but on the level of responsibility undertaken by the individual,” she said. “An experienced expert in the trade sector, for example, is worth twice as much as someone just starting out.”
The good news for Russians is that the difference in salaries for foreigners and Russians is shrinking. But foreigners are still earning the most on average, experts say.

“Foreigners will always be more expensive, because they incur expenses such as hardship allowances and relocation compensation,” according to Vyacheslav Volkov, general director of Slava/IIC Partners Executive Search Company, an executive-recruitment firm. He said that, while the salary gap is narrowing, it is primarily only in “major positions” that salaries are equal.

He explained that companies still demand Western expertise before offering employees high salaries. “Over the last 10 years, Russians have acquired the skills Western companies are looking for, like G.A.A.P. and C.A.P. certificates, plus M.B.A.’s.”
Yekaterina Dichenko, a research associate with Ward and Howell, a consulting company, agreed that companies are switching away from foreign employees, but said that Western knowledge and experience can significantly raise the value of a potential worker. She said that “work experience in a Western company, knowledge of a foreign language and education overseas,” are the first things employers look for before offering large salaries.

On average, Western firms are still paying higher salaries than their Russian counterparts, but the difference is also shrinking rapidly. ANCOR’s Denisova said that wages at Russian companies are still 30-40 percent lower than in Western firms. But she added that, in special cases, Russian firms pay “exclusive” salaries to employees considered to have “essential skills.” And other experts point out that some Russian companies are paying top managers far more than any Western company.

“Now there are plenty of Russian companies that pay managers better than in the West. Gazprom for example,” said Yevgeny Revzin, press service manager for RosBuisnessConsulting.

He says the experts most in demand at the moment are IT and PR managers. “The IT industry here is taking off, just like it did in the West,” he said. He explained that PR managers are sought-after due to the recent growth in the local advertising market, which has reached the pre-crisis levels. “Companies are taking a renewed interest in looking good,” he added.

The biggest addition to income, according to the study by ANCOR, is now in the form of benefits. The study indicates that mobile phones, company cars and health insurance are some of the most popular benefits. But the biggest trend among Russian firms is employee training. One hundred percent of the Russian companies surveyed by ANCOR offered some sort of employee training.

“Companies are placing more emphasis on human capital now,” said Denisova, explaining that Russian employers are learning to value their employees more.
Still, experts warn that competition on the Russian job market is intense, and there is almost always someone willing to work for less.

However, Denisova added that benefits in the public sector are much more widespread and better. “They have lots of nice houses-of-rests around Moscow,” she said.
Fortunately, there is little or no difference in pay for men and women in the professional world, which is somewhat surprising given the macho attitudes popular among Russian men.

Dichenko of Ward and Howell credited the lack of discrimination around the office to efforts made by the Soviet government to promote equality among the sexes.
Irina Lyaskovskaya, an accountant at SOS International, said she is treated with the same respect as her male co-workers and that women earn the same salaries. “Nowadays, people are interested in your experience and education, not your sex,” she said.
However, some workers — mostly men — say women are given less respect in the office.
Roman Maelyan, a former financial director for a construction company, believes women are looked down upon on the job.

“In my experience, there is a difference between the way men and women are treated at work. Maybe they are paid the same, but they aren’t given the same level of respect.”