Staunton, September 26 – The coronavirus pandemic has cut the incomes of 24 percent of the members of the Russian middle class and driven 6.1 percent of them into the ranks of the country’s poor, according to an analysis of Rosstat data by scholars at Moscow’s Higher School of Economics.
Before the pandemic, Rosstat said 24 percent of the population was middle class. The loss of 6.1 percent of them to the poor means that the overall loss in the percentage of middle class people is only 1.5 percent, to 22.5 percent, a small but significant number in such a short time (rbc.ru/economics/26/09/2020/5f6dde659a79477e5967a9e9
The HSE experts say that the high level of income inequality in Russia means that “the majority of families feel a growth in real incomes only when they increase 2.5 to 3 percent or more over three to five years.” That happened with high oil prices in the first decade of this century, but it has not been the case since. And prospects for a quick change aren’t obvious.
Three things are leading to an increase in poverty, they say. First, unemployment has risen dramatically, increasingly 47.6 percent between 2019 and 2020. Second, the pandemic crisis has hit informal employment even harder than regular employment. And third, families with children are suffering because they have more mouths to feed.
To counter this situation and to help those middle-class Russians who have fallen into poverty, the HSE experts call for federalizing the employment service to help these people find jobs, to increase subsidies for families with large numbers of children, and to establish more scholarships to higher educational institutions for them.
Unless these steps are taken, the experts warn, poverty is going to increase and anger about it as well.