face of the other demands on the shrinking national<sup>budgets.Fromthis recognitionfollowed the</sup> decision, taken at the highest levels of government,<sup>to embarkupon therestructuringof thecoal</sup> sector.

12. Table 1 provides an overview of the coal extraction<sup>workforceinPoland, Romania,Russia</sup> and Ukraine before restructuring was launched, and<sup>the forecastedneedfor thedownsizing of the</sup> coal extraction workforce in each country. As can<sup>beseen,coalsectorrestructuring involvesa</sup> substantial reduction of the pre-restructuring mining workforce<sup>inall countries.InPoland,the</sup> least severe case, the pre-restructuring coal extraction<sup>workforceisprojectedto be reducedby</sup> slightly less than half Restructuring in Russia is<sup>themostadvanced fromthe pointof viewof</sup> downsizing achieved by the end of 2001 relative to<sup>thetotalforecastedneedfor downsizing,and</sup> least advanced in Ukraine from this perspective.

Table 1. Coal Sector Restructuring in Four Countries

|||Poland<br>|Romania<br>|Russia<br>|Ukraine<br>|
|---|---|---|---|---|---|
|(i)|Yearrestructuringpolicyadopted<br>|1998<br>|1997<br>|1993<br>|1996<br>|
|(ii)|Numberofcoal extraction workersat<br>commencementofrestructuring|243,000<br>|113,000<br>|373,000<br>|410,000<br>|
|(iii)|Numberofcoalextraction workersat<br>end2001|145,000<br>|46,000<br>|178,000<br>|300,000<br>|
|(iv)|Projected numberofcoal extraction<br>workersremainingatendof<br>restructuringa<br>|133,000<br>|18,000<br>|160,000<br>|150,000<br>|
|(v)|Totalreductioninmining workforce<br>plannedoverperiodofrestructuring[(ii)-<br>(iv)]<br>|110,000<br>|95,000<br>|213,000<br>|260,000<br>|
||Forecasted%ofworkforcereduction<br>over periodofrestructuring[(v)/(ii)]<br>|45%<br>|84%<br>|57%<br>|63%<br>|
||%offorecastedworkforcereduction<br>completedbyend-2001[(ii-iii)/(v)]|89%|71%|92%|42%|

a World Bank estimates.

13. In addition to the large numbers of miners who are<sup>separated from theindustry through</sup> formal restructuring programs, the crisis conditions<sup>prevailingintheindustrytypicallyleadto</sup> the large-scale departure of other workers. These are both the various<sup>categoriesof workers</sup> associated with mining but not actually engaged<sup>inextractingcoalatthefaceornew</sup> development work, and workers employed at auxiliary<sup>enterprisesandinothernon-core</sup> activities (for example, social services) that were previously<sup>on thebalancesheetsof thecoal</sup> enterprises. In Russia, for example, over the period<sup>1993-2001,some 354,000 non-miners left</sup> the coal industry, which exceeds by far the number of miners<sup>wholeft theindustry.Finally, the</sup> mass downsizing of the coal industry inevitably<sup>has a negative downstreamimpacton jobsin</sup> industries that supply the coal sector and in consumer-oriented<sup>industries thatsuffer as a result of</sup> the decline in household purchasing power.

14. Furthermore, in some cases high wage arrears drove<sup>workers outof theindustry beforethe</sup> adoption of formal sector restructuring policies and<sup>theintroductionofincentivepackages</sup> designed to reduce the labor force. In Ukraine, for example,<sup>the total coal sectoremployment in</sup> 1994 was about 925,000 people (or, as noted earlier,<sup>about4.3%of thecountry'slaborforce.)</sup> From 1994 to 1996 - that is, before the restructuring<sup>policywas adopted-thisnumberdeclined</sup> 4