Human capital has weighed on Russia’s economic growth in recent years due to weaker public health outcomes and a slower inflow of young workers. This is based on analysis from RBC, drawing on a study by the experts at the HSE Development Center, led by Daria Avdeeva. The findings show that the contribution of human capital to GDP dynamics in 2020 and 2021 was negative, at about -0.4% and -0.6% respectively. Earlier periods, notably 2000–2003, also saw negative effects, primarily linked to health declines among citizens.
Between 2004 and 2017, human capital helped push GDP growth forward, reaching a peak impact of around 1.3 percentage points and accounting for roughly 15% of total growth in 2007. After that peak, the strength of this influence faded, and since 2018 its positive contribution has stayed below 0.1 percentage points.
A key factor behind the weaker role of human capital in recent years is the slowdown in the entry of young people into the labor market during the 2010s. In the 2010–2013 period, the average annual contribution from human capital stood at about 0.9 percentage points, but it declined to around 0.5 percentage points in 2014–2017, and has hovered near zero thereafter. The expert notes that from 2000 to 2008, employment in Russia rose from 65.1 million to 71 million, which supported renewal of human capital through youth inflows. Subsequently, the growth trend reversed.
Avdeeva cautions that ongoing economic transformation driven by sanctions elevates risks for human capital prospects, and these risks have translated into a negative impact on GDP in the most recent years. The discussion around these dynamics emphasizes how demographic trends, health outcomes, and policy environments collectively shape Russia’s growth trajectory in the present context.
The analysis also reflects broader concerns about financial market scenarios and potential systemic shifts. Market observers have highlighted the possibility of abrupt changes in major stock indices and debt dynamics, underscoring the connection between macroeconomic health and investor sentiment. These considerations reinforce the importance of stable conditions for sustaining human capital development and long-run economic resilience.