Delivery costs in St. Petersburg are forecasted to surge following Beglov's decision
In St. Petersburg, a recent decision by Governor Beglov to limit the hiring of foreigners as couriers has raised concerns about potential labor shortages and increased costs in the delivery sector. The ban, which comes into effect as early as November, may pose significant challenges for small businesses that rely on affordable and timely courier services.
According to Alexander Mityukov, president of the Association of Transport and Logistics Companies (MAKS), the cost of delivery may increase by one and a half to two times as a result of the ban. The high season for delivery services in St. Petersburg, which typically occurs in November, could see a particularly sharp rise in prices due to increased demand for delivery services and reduced labor supply.
Foreign nationals, including many from Uzbekistan and Tajikistan, constitute a substantial portion of couriers in St. Petersburg. Their removal from these roles risks aggravated labor shortages in the delivery sector, which is growing rapidly. The shortage of delivery workers may also lead to remuneration increases for couriers, with estimates suggesting a potential 20% increase and more.
The ban builds on earlier measures restricting migrants from working as taxi drivers in St. Petersburg, reflecting a broader trend of tightening migrant labor in service sectors across Russia. The outflow of foreign workers from other sectors may exacerbate the shortage of delivery workers in St. Petersburg.
City officials assert that since foreigners comprise a "small share" of couriers, the delivery market should remain stable despite the ban. However, experts warn that the ban could have a notable impact on labor supply and costs. Employers have been allowed a three-month adaptation period to retrain or replace migrant couriers, but the overall adjustment may be disruptive.
The ban is expected to increase delivery market costs and pose challenges for small businesses, primarily due to labor shortages and potential price hikes. Although officials claim the measure targets improving service quality, combating hidden labor, and creating jobs for locals, experts and migrant labor advocates warn that restricting a significant share of the courier workforce will reduce labor availability and drive costs up by an estimated 10–50% for taxi and delivery services.
The restrictions for couriers may create additional demand and increase the cost of labor resources, potentially stimulating the outflow of foreign workers who did not fall under the ban from retail. Strict bans on foreign workers have been implemented in Crimea, allowing them to work only in construction and tourism industries. Over 80 sectors of activity have been banned.
In summary, while the government frames the ban as a policy to support local employment and improve service standards, practical consequences could include higher delivery costs, labor shortages, and increased challenges for small businesses dependent on courier services in St. Petersburg. The transitional period of three months is unlikely to bring the market into balance in the near future due to the shortage of delivery workers.
- The ban on foreigners working as couriers in St. Petersburg could potentially increase delivery costs and cause challenges for small businesses, mainly due to potential labor shortages and possible price hikes.
- Experts and migrant labor advocates warn that the restrictions on the courier workforce could significantly reduce labor availability and cause costs to rise by an estimated 10-50% for taxi and delivery services.
- The strict bans on foreign workers in certain regions, like Crimea, have led to a potential increase in the cost of labor resources and increased demand for those resources.
- The policy and legislation implemented to limit foreign labor in the industry and retail sectors may inadvertently impact the general news landscape, as businesses struggle to adjust and prices fluctuate due to labor shortages.
