Medium-Term Forecast of Government Spending on the Unemployment Social Protection System in Russia in the Conditions of Economic Recession

A simulation model of the Russian unemployment social protection system is developed and used to study the impact of the economic crisis caused by the COVID-19 pandemic, demographic processes, and the increase in retirement age on federal spending on unemployment benefits. Trends of overall and registered unemployment across various socio-demographic groups in 1992–2020 are analyzed, with special attention paid to periods of economic recession and recovery. The identified patterns are used to develop modeling scenarios. Calculations show that in the unfavorable scenario government spending on unemployment benefits will increase many times. As a possible solution to the problem, it is proposed to convert the unemployment social protection system to insurance principles. The time frame in which reforming the system would be less expensive for the federal budget is defined.