The Moscow Times quoted the State Statistics Service said another 300,000 Russians lost their jobs in February, bringing total layoffs to more than 6.4 million, or 8.5% of the work force, since the beginning of December.

In January, the service also reported that around 300,000 people lost their jobs following 500,000 losses in December.

Mr Neil Shearing, an emerging-market economist at Capital Economics in London in a report before the data release that "As firms struggle to access financing, unemployment looks set to soar to 12%. This will spell disaster for an economy in which private consumption accounts for over half of GDP."

Government officials have said they expect Russian companies to continue cutting the work force with big layoffs expected in April, which could bring unemployment rates closer to highs of 9.2 million seen in the socially unstable 1990s.

The government, which on Thursday was debating over a new revised budget, had to slash spending in the face of falling prices for commodities but has said it would spend more on social needs to protect stability.

The unemployment figure was the highest since March 2004 and slightly above analysts' expectations of 8.4% in a Reuters poll.

(Sourced from The Moscow Times)