Nine Signs Russian Economy in Deep Trouble

Paul Goble

            Staunton, Jan. 7 – The Russian government and its supporters always seek to put the best face on things, including the economic situation of the country over the last year. They cite various macro-economic figures to show that things aren’t as bad as many say. But for ordinary Russians, life is getting worse – and Vyacheslav Dvornikov of The Bell offers nine signs of this.

            Some of these are obvious but others are more indirect. However taken together they paint a picture of a Russian economy in severe difficulties since the start of Putin’s war in Ukraine, difficulties that are having profound consequences for Russians and the way they actually live (thebell.io/9-priznakov-togo-chto-v-rossiyskoy-ekonomike-vse-plokho).

            The nine are as follows:

1.    1.  Existing restaurants are closing and new ones aren’t opening, and Russians are shifting their purchases from more expensive cafes to fast food restaurants although even that sector is hurting as incomes continue to fall (kommersant.ru/doc/5733166 and kommersant.ru/doc/5747372).

2.    2.  Ever more Russians are working shorter hours as firms try to avoid laying them off. This phenomenon is especially true in major cities like Moscow.

3.   3.   Russian firms are paying fewer and smaller bonuses this year than last (press.rabota.ru/v-etom-godu-vyplachivat-novogodnie-premii-budut-v-2-raza-rezhe-chem-v-proshlom).

4.    4. Russians are again increasing their consumption of vodka, reversing the trend of the last decade and increasingly drowning their sorrows in hard liquor (brokerkf.ru/doc/ideas/Flash_note_BELU_03102022.pdf).

5.   5.  Realtors have been forced to cut back charges for their services by as much as half because of declining demand for real estate (kommersant.ru/doc/5722152).

6.    6. Ever fewer Russians are visiting shopping centers, choosing instead not to buy anything or to buy from street venders (iz.ru/1433547/2022-11-30/poseshchaemost-ttc-v-rossii-snizilas-na-15-30 and kommersant.ru/doc/5572560).

7.     7. On dating sites, women are increasingly taking the initiative.

8.   8.  Business advertising on television has collapsed. If a year ago, advertisers were prepared to buy up to 90 percent of the time allowed to sell their wares. Now, they are buying only 63 percent of that time (rbc.ru/technology_and_media/12/07/2022/62cc24769a794743ec866d31).

9.    9. Millions of Russians who tried investing in the stock market in the past have pulled their money out and view brokers in an increasingly negative way now that prices have collapsed.