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The Silver Lining of Unemployment

From a WSJ piece on Russia’s steep increases in unemployment as the year comes to end:

Growth in joblessness could actually be the result of an improving economy, said Vladimir Tikhomirov, chief economist at Moscow-based investment bank Uralsib.

“At the start of the crisis, government loans were made on the condition that companies not fire people,” Mr. Tikhomirov said. “Now that balance sheets are in better shape, these same companies are less tied to government loans, and will be looking to cut costs by firing people.”

Still that seems like quite a bitter pill to swallow.  The article reports that 3/5ths of Russian companies plan to cut back their workforce, putting the official unemployment rate at 8.1% – that’s 6.1 million who aren’t going to have a nice Christmas.  Things could be worse … Spain may hit 20% unemployment in the new year, and I’m not sure anyone thinks the numbers are the result of an improving economy.