Foreign language Issue 3, 2018 of the analytical review – The Monitoring of Socio-Economic Situation and Perceptions of the Population
Foreign language Issue 3, 2018 of the analytical review – Monthly Monitoring of Socio-Economic Situation and Perceptions of the Population (English and Russian Version). Analytical material prepared by a pool of experts of the Institute for Social Analysis and Prediction of the Russian Presidential Academy of National Economy and Public Administration.
Main conclusions of the issue:
- Russia’s GDP in Q2 2018 amounted to Rb 24,846.6bn; its constant price index thus gained 1.9% relative to Q2 2017.
- In July 2018, retail trade turnover in comparable prices amounted to 102.5% relative to the corresponding period of the previous year, including 101.5% for the retail trade turnover of food products, beverages and tobacco products, and 103.3% for that of non-food products. Since the share of non-food products is likewise higher in the retail trade turnover structure, it may be concluded that this has been the main driver of growth.
- Over the course of H1 2018, the volume of retail lending amounted to Rb 5.5 trillion, which is 39% above the corresponding index for January-June of 2017. The volume of individual bank deposits rose to Rb 27 trillion. In the retail lending sector there was significant growth, over Q1 2018, of the volume of newly issued loans relative to Q1 2017 (by 13.7%), mainly due to a revival in the housing mortgage market. The monthly movement pattern of retail lending volume displays an average growth rate of 1%.
- Nearly a quarter (24%) of all retail loans issued by banks over H1 2018 were housing mortgage loans. Housing mortgage debt amounts to 43% of total household debt. The role of the housing mortgage segment in the retail lending market has increased.
- As a result of the recent switchover to the new rules of share participation in residential building construction projects, the number of individual share participation contracts over the course of H1 2018 increased by 10%, to 338 thousand. This figure, however, appears to be less staggering when set against the corresponding index for 2014, which is just under 850 thousand.
- In July 2018, the number of persons in the labor force amounted to 76.3m, which represents a decline by 0.16m on July 2017.
- For a third month in a row, the unemployment rate (according to the ILO methodology) has been staying at 4.7%, while continuing to slide when cleared of its seasonal component. The rate of registered unemployment as of the end of July was 0.9%. Thus, these two indices have hit their historic lows.
- The number of persons employed at big and medium-sized enterprises has continued to shrink. The resulting free workforce has been channeled into the informal sector, which has increased over the past year, but is still smaller than in 2016.
- In July 2018, the growth indices of real disposable money income, real charged wages and salaries, and real allotted pensions amounted to 2.0%, 8.0%, and 0.8% respectively. Thus, the growth indices of real disposable money income and real allotted pensions had been lagging significantly behind that of real charged wages.
- According to the updated statistics for 2017 released by Rosstat, last year 55 regions demonstrated poverty levels above Russia’s mean poverty index, and in 12 regions it rose more than 1.5 times above the latter. Poverty decline in 2017 on 2016 was observed in 34 regions, and at the same time in 37 regions poverty increased, however slightly.
- In January-July of 2018, the share of money income allocated towards savings amounted to 5.9%, thus hitting its record low of the last 15 years. The shrinkage of that index relative to the corresponding periods of 2015-2017 can be attributed, among other things, to a notable growth in individuals’ accounts payable – by 6.4%.
- According to data released by the Public Opinion Foundation, in August 2018 the self-rated income inequality increased relative to the corresponding period of 2014.
- Over the first 7 months of 2018, Russia’s natural population decline index increased to 170,500. The number of births registered over January-July of 2018 amounted to 928,800, which is 4.2% less than the corresponding index for the same period of 2017. The number of deaths over the first 7 months of 2018 rose by 1.4 % above the corresponding index for 2017 (an increase by 15.600); the indices of mortality caused by neoplasms, diseases of the digestive system, diseases of the nervous system, and endocrine, nutritional and metabolic diseases have all increased.
- The results of H1 2018 differ across regions in terms of their indices of socioeconomic development and budgets. The economy and the social spheres are slowly overcoming their stagnation, while household incomes in the majority of regions have continued to decline. The budgets of regions have improved, mostly due to the significant growth in PIT receipts and transfers; social expenditures have also increased significantly, but this can largely be explained by the electoral cycle – the presidential election and the elections of governors in a quarter of all Russian regions.