BOFIT Viikkokatsaus / BOFIT Weekly Review 2015/22
Real wages declined in the fourth quarter of 2014 – the first time this has happened since the 2009 recession. The decrease has continued this year. For January-March, preliminary figures show real wages declined 8 % from 1Q14. The slide accelerated to 13 % y-o-y in April. Wage arrears also rose.
The real value of pensions began to fall at the end of last year, but not as fast as wages. Preliminary figures for January-March show a 4 % decline from 1Q14. Despite hard economic times and slated budget cuts, the government still struggles to hold the line on the real value of pensions. Russia’s leaders still remember the 2005 nationwide demonstrations of disgruntled pensioners precipitated by changes in the social security system.
Russia’s economic difficulties now affect the daily lives of most people. A March survey by the Sociology Institute of the Academy of Sciences found that 46 % of respondents said their economic situation had deteriorated over the past year. In October, only 22 % of interviewees held this view.
Unemployment rate and on-year change in real wages, %
Source: Rosstat.