Expats in Russia don’t earn more but get substantial relocation packages

by Ray Clancy on October 25, 2011

Expats often receive generous housing allowance, flights home and schooling for children.

The myth that expats in Russia earn more than native professionals is not true, according to a new survey. By expats win in terms of the relocation packages they often receive when moving.

There is almost no disparity in incomes, according to the salary survey carried out by leading newspaper the Moscow Times.

What distorts the numbers, however, is the accompanying package that expats often receive when they are relocated to Russia. In many cases, these are very generous in terms of housing allowances, flights home, a personal driver and schooling for children. In most cases, the extras cost significantly more than the expat’s salary.

Foreign assignments vary in length, but it is usually in the range of three to four years, the survey also found.

The main reason for a company moving expats to Russia is their strong understanding of the internal workings of their particular company, even if they know nothing about the country they have just arrived in and their mandate is to keep the business going according to head office’s wishes, or in some cases to eventually replace themselves with locals.

Even large multinationals employ very few foreigners as a percentage of the overall work force. But despite their small numbers, there can be resentment as to how effective they really are in relation to their pay.

The common perception is that it takes new expats a year to adjust to life in Russia, settle their families and get their feet off the ground. This is followed by a year trying to reverse the mistakes of their predecessors, followed by a year trying to work out where they are being sent next.

The newspaper has gathers together tips for new expats in Russia. It says that Russians tend to be very well educated and highly knowledgeable in areas of culture, politics and geography.

‘In fact, the average Russian probably knows more about your country’s history and literature than you do. What some lack, and this is due to 70 years of communism, is the commercial  acumen acquired purely by growing up in a free market, capitalist society,’ it says.

‘Whatever you do, don’t ever take the moral high ground of we know how to do things better because our country is richer. This will be taken for exactly what it is, arrogance. The current economic downturn affecting much of the developed world shows that not everything back home works to perfection,’ it adds.

It also points out that unless you have studied Russian or worked in the former Soviet republics before, you are unlikely to master much Russian during your assignment, especially if, as many are, you are confined to the expat bubble of living in expat dominated enclaves.

It explains that basic tasks such as purchasing car insurance, which in the West can be done online or by telephone, often needs a personal visit and, unfortunately, often during the working day and says newcomers should be flexible and allow time off for such matters as there is no getting around it.

‘The bane of the majority of expat managers is when Russian employees take copious time off for sickness. This is a hard battle to win. The most common solution is to allot only five or 10 days a year to employees for paid sick days,’ it adds.

It also advises avoiding the mistake of preferring mediocre staff with good English over stronger employees whose spoken level of English is not quite up to strength.

‘Remember that the vast majority of their work will be done in Russian. They will communicate with colleagues, partners and clients in their own language. Russians often read and write English considerably better than they speak it, due largely to the educational system and also a lack of practice,’ it says.

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