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Potential of Using the Results of Market Observations in Forecasting Employment in Small Businesses in Russia

The article presents results of analysis of the predictive potential of short-term forecast estimates of employment level in the small business segment by four sectors of the Russian economy: manufacturing, construction, wholesale and retail trade.From the authors’ point of view, one of the promising sources of data for such estimates can be found in market observations of entrepreneurial activity, which now are a common source of economic information in national as well as international practice. These surveys play an important role in measuring the dynamics of employment in countries and industries, being a supplementary statistical tool.The objective of the work was to prove the existence of a stable statistically significant relationship between the predicted estimates of employment based on business (market) surveys and the dynamics of the corresponding statistical macro-aggregates in various sectors, and applicability of predictive models of employment change based on results of business (market) surveys.The novelty of the presented results (authors’ contribution) resides in the fact that for the first time, using an expanded sample (over 14 thousand respondents), were studied the possibilities of predicting labour market indicators in small businesses based on leading data from business surveys, examining separately retail trade, wholesale trade, construction, and manufacturing. According to the results obtained based on the Granger causality and pseudo-out-of-sample analysis, in all the industries under consideration, entrepreneurial assessments and expectations are effective predictive indicators for forecasting employment dynamics in the short term (two to four months) and identifying turning points in employment growth in the small business segment. The most sensitive predictive estimates were found in the retail and wholesale sectors, with the best results obtained for wholesale trade. For this reason, the authors recommend using the employment expectations indicator primarily in these sectors to monitor the level of employment and unemployment.