All-Russian Research Institute of Labor: income inequality in Russia has decreased threefold in 20 years

The gap in income levels between the highest paid and lowest paid workers in Russia over 20 years has decreased almost threefold to 13.1 times, reported at the All-Russian Research Institute of Labor “Izvestia”.

For the calculations, the income of 10% of workers with the highest earnings and 10% of citizens with the least was used. In 2001, the difference between them was 40 times, in 2005 – 24.9 times, in 2017 – 14 times, and in 2022 – 13.8 times.

According to the results of the first half of the year, notes the All-Russia Research Institute of Labor, citing Rosstat data, in Russia, the 10% of the most affluent Russians accounted for 29.8% of the total income, and the share of the 10% of the least affluent – only 2%. The most significant increase in wages was recorded among representatives of skilled blue-collar professions, analysts added.

Experts interviewed by the publication believe that the reduction in wage inequality is due to an increase in earnings of the least paid workers and an increase in salaries due to a shortage of personnel, and also expect the trend to continue in the future.

In June, President Vladimir Putin announced an increase in the minimum wage by 18.5%, to 19,242 rubles, from January 1, 2024. He noted that in this way the indicator will outpace the rate of inflation and wage growth. At the same time, the head of state admitted that by 2030 the minimum wage could double in nominal terms, which would become an additional incentive for wage growth in all regions of Russia. At the end of September, the draft on increasing the minimum wage was introduced to the State Duma.

According to Rosstat, as Vedomosti previously wrote, in the second quarter of 2023, the population with incomes below the poverty line amounted to 15.7 million people, or 10.8% of the country’s population. Compared to the same period last year, the share of low-income Russians decreased by 1.3 percentage points or by 1.9 million citizens.

In the first six months of 2023, the number of Russians with incomes below the poverty line decreased by 1.6 million people compared to the first half of 2022 – to 17.3 million people. The poverty line in the first half of 2023 was at the level of 14,106 rubles, and a year earlier – 13,365 rubles.

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