From Volga River to Yenisei River: barometer of living standards in Russian regions

There are still more weak subjects in Russia than strong ones, the situation of residents in some of them, to put it mildly, is unenviable

There are much more regions with low and extremely low living standards in Russia than prosperous ones, and the gap between them remains enormous. In some regions of the Russian Federation there is chronic poverty, the unemployment is 4-5 times higher than the average in Russia. The most troubled region is the North Caucasus, but there are also local problems in Siberia, in the south, in the Volga region and in the Central District. Read more in the survey of Realnoe Vremya.

Where life is more prosperous

High oil prices, growth of federal transfers and good tax collection rate have benefited regional budgets: in the first half of the year their revenues increased by almost 10%, and there have remained only 25 deficit budgets. But it has not relieved many problems. In varying degrees, there are still much more weak subjects in Russia than strong ones, the situation of residents in some of them, to put it mildly, is unenviable.

Realnoe Vremya has rated the regions in terms of living standards. The rating is based on several indicators: the ratio of wages to local subsistence minimum, poverty and unemployment, as well as the ratio of per capita income to the cost of the fixed set of consumer goods and services.

Each of these indicators gives from 0 to 2,5 points. Depending on the final score, the regions were divided into four categories: high standard of living (8-10 points, such subjects are marked in yellow in the table); average level (5,5-7,9 points, marked in yellow); low level (3,5-5,4 points, marked in grey); extremely low level (0-3,4 points, red).

The result is that most of the regions fell into the average category. There are 10 ''green'' subjects: Moscow, Moscow Oblast, St. Petersburg, Nenets Autonomous Okrug, Yamalo-Nenets Autonomous Okrug, Khanty-Mansiysk Autonomous Okrug, Chukotka Autonomous Okrug, Tatarstan, as well as Magadan Oblast and Sakhalin Oblast. There are 13 regions with a low standard of living.

Finally, the ''red'' category includes nine subjects of the Russian Federation. Almost half of them are concentrated in the North Caucasus (Ingushetia, Kabardino-Balkaria, Karachay-Cherkessia, Chechnya). Three such regions (Zabaykalsky Krai, Tuva and the Altai Republic) are located in the Siberian Federal District, two more — in the Far East (Jewish Autonomous Oblast) and in the Southern Federal District (Kalmykia). All regions-outsiders are characterized by chronic poverty and a mass of other socio-economic problems.

Rating of Russian regions by standard of living

Wages in Yamalo-Nenets AO are equal to six subsistence minimums, in Tatarstan — to three and a half ones

The absolute leader of the rating is the Yamalo-Nenets Autonomous Okrug, a region of the Far North, which produces more than 90% of Russian natural gas and more than 6% of oil. YNAO is the only one of all subjects that received the maximum score by all indicators. For example, the average wages in the district in the first half of the year corresponded to 6 subsistence minimums of the able-bodied population, although in most regions they did not reach even 3,5 local minimums.

Per capita income of residents of the district (from 67,900 to 73,200 rubles in April-June 2018) allows them to buy 3,6-3,9 fixed sets of consumer goods and services. This is 1,5-2,5 times more than in most other regions. Besides, there are no problems with unemployment in YANAO, and the poverty rate is about twice lower than the national average.

The second line of the rating was shared by Moscow and St. Petersburg, which scored 9,5 points. The purchasing power of wages and incomes in these subjects is slightly lower than in YANAO. The average wage in St. Petersburg corresponded to nearly 5 subsistence minimums of the able-bodied population, in Moscow — 4,6. Money income in the capital of Russia is 2,4-3,3 from the cost of the fixed basket of goods, in St. Petersburg — from 2,3 to 2,8 baskets. The level of unemployment and poverty in these regions of the Russian Federation is also significantly lower than the national average.

Five regions received 9 points. Among them, there are Sakhalin Oblast, Khanty-Mansi Autonomous Okrug and Nenets Autonomous Okrug, Tatarstan, and Moscow Oblast.

Khanty-Mansi Autonomous Okrug (KMAO), the second region of the Ural Federal District among the leaders of the rating, has the reputation as one of the richest Russian subjects (in 2016, the district's contribution to the country's GDP exceeded 3,5%). The ratio of wages to the subsistence minimum in the region was 452%. However, the subject did not receive the highest score in the relation of incomes to the cost of a fixed basket of goods.

Tatarstan, which turned out to be the only ''green'' region in the Volga Federal District, received 2 points for the purchasing power of wages and cash income. The average salary in the republic is 3,6 subsistence minimums of able-bodied citizens, and the income allows them to buy 2,4-2,6 sets of consumer goods and servoces. The region received the highest points for the indicators of poverty (7,7%) and of unemployment (3,4%). The situation is almost the same in Moscow Oblast.

At the same time, in some regions with a high standard of living, the level of poverty is higher and comparable with the national average. For example, in the Nenets Autonomous Okrug, one of the most sparsely populated subjects of the federation, it exceeds 11%, in KMAO it is 12,6%.

40% of Tyva residents live below the poverty line

In the category of outsiders, two subjects — Ingushetia in the North Caucasus and the Republic of Tuva in Eastern Siberia – received the weakest results. Both of them scored only 1 point. In the regions, there is a critically high level of poverty: in Ingushetia it exceeds 30%, and in Tuva more than 40% of households are below the poverty line. The unemployment rate in Tuva and Ingushetia is also 4-5 times higher than the national average: 20,5% and 26,4%, respectively.

Besides, these regions have one of the worst ratios of cash income to the cost of the fixed set of consumer goods and services. In Ingushetia, the income in April-June ranged from 14,400 to 15,800 rubles. This money allow them to purchase from 1,1 to 1,2 consumer baskets.

In Tuva, the average cost of consumer baskets in these months amounted to 13,600 rubles, incomes — from 12,700 to 15,200 rubles. Thus, the inhabitants of the republic could buy from 0,9 to 1,1 consumer baskets.

However, this ratio is low in many other regions from different parts of the country as well. In the Volga Federal District, 0 points by this indicator were given to three regions — Chuvashiya, Mordovia and Mari El Republic. Residents of these subjects have enough money for 1,3-1,6 baskets of goods.

In the south of Russia, the residents of Kalmykia have the lowest purchasing power of incomes. They can buy no more than 1,2 baskets of goods and services. In the Far East, the residents of the Jewish Autonomous Okrug are in the same situation (1,3-1,4 baskets), and in the Caucasus, in addition to the residents of Ingushetia, — the population of Karachay-Cherkessia (1,2 baskets).

Some troubled regions were found even in relatively trouble-free Central Federal District: Ivanovo Oblast has the lowest ratio of wages in Russia to the subsistence minimum. In general, the regions of the ''red'' category are in four of the eight federal districts.

  • Stepan Zemtsov

    Stepan Zemtsov Senior Researcher at Institute of Applied Economic Research, RANEPA

    It is clear that in some regions of Russia there are objective and not very objective factors that limit their development. For example, in Tuva, the main objective factor is remoteness from all world centres and sea ports. This remoteness determines everything: whatever you build, it will be extremely difficult to sell, because it will have to transport products very far. The same can be said about some northern regions and the Far East in general. As long as there are no high-speed roads and access to sea, transport costs will be very high.

    Another factor is difficult natural conditions. In the North, there are high cost of heating. A simple example: an enterprise in China does not even need walls. But try to build a production facility in the Nenets Autonomous Okrug or Chukotka. There are also restrictions related to mountains. This also applies to Tyva and the Altai Republic. The relief of the territories of these subjects affects the final cost of the products produced there.

    Human capital can be among the subjective factors. Economic development requires universities and appropriate technical training systems. Of course, in many agricultural regions, where there are no large agglomerations, the situation with human capital is more difficult.

    Well, the most important subjective factor is the institutional environment. There is such expression — ''to shoot from the hip''. So, if in a region they shoot from the hip, no investors — neither domestic nor foreign — will not come there.

  • Anton Tabakh

    Anton Tabakh Chief Economist at Expert RA rating agency

    Most weak regions are characterized by remoteness, in many ways — subsistence farming, as well as a large proportion of self-employed and employed in the shadow sector. Therefore, the data of Rosstat, especially on income, should be treated sceptically — the level of poverty fixed by statistics, in the case of such regions, can be inflated (this, by the way, is typical not only for Russia but also for other countries with a similar population structure). If you look at indicators such as electricity consumption or the level of car ownership, the gap with other regions will not be as serious as by incomes.

    Yes, some regions have natural limitations, but there are also potential growth points. In Tyva, such points can be raw materials and tourism. Tourism is already developing in the Altai Mountains, but this is a sector that is often not included in the statistics.

By Artyom Malyutin