Anyone investing in Russian stocks should read a recent article entitled Russia’s Growing Middle Class in for a Scare in the Moscow Times which puts some perspective on the Russian middle class. What exactly constitutes the Russian middle class has been a subject of a two-decade-long debate, with estimates ranging from 2% to 80% of all Russians based on whatever criteria is being used.
However, here are some interesting facts and/or figures from the article about who the Russian middle class are and how they are faring right now:
- A Russian’s average monthly wage was 29,900 rubles ($860) in 2013, compared to $4,300 for Americans.
- The World Bank says 60% of the Russian population belonged to middle class in 2010, up from 27% in 2001. This year, the bank also classified Russia for the first time as a high-income economy.
- In poll held in April by headhunting agency Superjob.ru, 37% of respondents identified themselves as middle class.
- Alexander Safonov, deputy principal at the Russian Presidential Academy of National Economy and Public Administration in Moscow (RANEPA), says the business-related middle class stands at 4.5 million and state-employed wealthy consumers would be 14 million people. Russia’s total population stands at 143 million, of which 75 million people are economically active.
- A commercial property tax hit business last year, and social security payments for small businesses have been hiked to 30% from 14% in 2011.
- Car sales in Russia have slumped 4% year-on-year since the beginning of 2014, according to the Association of European Businesses.
- More than 1,000 new stores were opened nationwide by foreign retailers last year, retail consultancy Magazin Magazinov reported in February.
To read the whole article, Russia’s Growing Middle Class in for a Scare, go to the website of the Moscow Times.
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