MOSCOW, July 31 (Reuters) - Unemployment in Russia hit a record low of 1.9 million people, or 2.4% of the workforce, in June, according to official statistics, as the army and defence sector recruit heavily in an overheated economy.
This compares with a rate of 2.6% in May and a Reuters forecast for June also of 2.6%.
Russia's central bank hiked its key interest rate by 200 basis points to 18% last week, the highest level in more than two years, pointing to labour shortages and wage growth as the main signs of an overheated economy, and vowing to maintain tight monetary policy and fight inflation until it cools.
The low rate of unemployment in Russia is accompanied by growth in wages as generous payouts for volunteers to fight in Ukraine set a benchmark across all sectors of the economy.
Russian President Vladimir Putin doubled upfront payments for army volunteers on Wednesday, bringing the minimum annual wage in the first year of service to 3.25 million roubles ($37,791), more than three times the average wage in Russia.
Average nominal wages leapt 17.8% in May year on year to 86,384 roubles ($1,002.72), while growth in real wages was much slower at 8.8% year on year due to high inflation, currently running at 9.0%. Real wage data is reported with a one-month lag.
According to Rosstat, real wages grew 10.1% in the first five months of the year, while nominal wages increased 18.7% compared to the same period of 2023.
High wages are also fuelling a consumer boom but annual retail sales growth slowed to 6.3% in June.
In the first six months of the year, retail sales, according to Rosstat, increased 8.8% compared 2.8% in the same period of 2023. The economy ministry estimates retail sales growth in 2024 at 7.7% after 6.4% last year. (Reporting by Darya Korsunskaya; Writing by Gleb Bryanski; Editing by Kirsten Donovan)
