These developments have been associated with a precipitous fall in the working-age population ( Au et al., 2005), major challenges to the reform of social welfare and the emergence of unconventional labour market institutions accompanying the industrial transformation that has taken place during the last three decades ( Lehmann and Muravyev, 2012 Slonimczyk and Gimpelson, 2015). Since the fall of the Soviet Union, Russia has experienced a sustained demographic decline, unprecedented fluctuations in mortality rates and the continuation of a long-term relative deterioration in health, driven by a rapid growth in chronic disease and multimorbidity.

Understanding how to attenuate the negative labour market consequences associated with health shocks is paramount and we, therefore, consider the potential role that labour, health and social policies can play in mitigating risk. However, consistent with our knowledge of the Russian labour market, we also observe that the wage and income elasticities are considerably higher than the employment elasticities and above those reported for other countries. We find that the effects are strongest for males, the less educated, those on lower incomes, those in middle-ranking and professional occupations, and for those experiencing the most severe health shocks. Employing data from the Russia Longitudinal Monitoring Survey-Higher School of Economics, we demonstrate that adverse health shocks have negative consequences for employment, wages, and income. This study examines the effects of individual health shocks on labour market outcomes in the Russian Federation during the period 2000–2018.

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