Using survey data collected over 1991-2005 by the Russian Economic Barometer (REB) author traces the trajectory of the Russian labor market evolution under transition. The REB micro-data provide a unique opportunity to look at employment restructuring from the standpoint of enterprises – economic agents which shape labor demand. The study is focused on such problems as labor hoarding; wage arrears; worker and job reallocation; de-skilling of industrial personnel; constrains in the labor market limiting enterprises' production capacities; shortage of skilled workforce; major trends in productivity, producer real wage and unit labor costs. The analysis suggests that in order to maintain competitiveness in the medium- and in the long-run the Russian industrial enterprises should increase substantially effectiveness of their screening procedures and provide much more investment in training and retraining programs of their personnel.