Goal of research is to analyze the socio-economic behavior of Russian households in 1994—2016 and to assess the volume of social capital and its differentiation.
Methodology: quantitative analysis of the data obtained from the series of nationally representative household-based longitudinal surveys.
Empirical base of research: “Russia Longitudinal Monitoring Survey of HSE” (RLMS-HSE) database, which combines the data collected from 1994 to 2016, with the particular emphasis on the data collected between October, 2016 and January, 2017.
Results of research:
After a two-year decline, there was an increase in real household income. While an average income dropped by 6.4% between 2013 and 2015, it grew by 11.1% in 2016. Work-related household income rose by 10.6%, recovering after a 9.1-percent decline in 2013-2015. In 2016, income from formal employment went up by 8.2% in state-owned enterprises, by 13.8% in private organizations and by 19.4% in public-private companies. Household income from government transfer payments continued to grow with an annual increase of 11.8%. Total monetary and in-kind revenue from domestic production and informal economy showed a 10-percent increase, while income from charity and help of relatives grew by 16.4%.
Work-related income and income from government transfer payments continued to yield the greatest share of household income. However, from 2011 to 2016 the share of work-related income decreased from 51.1 to 45%, while the share of transfer payments rose from 35.4% to 42%. In 2016, both went down by negligible 0.1%.
The income inequality further decreased as four bottom income quintiles saw their income rising from 11.1% in 2015 to 15% in 2016, while the top quintile experienced only a 7.1-percent increase in income. Nevertheless, the income of the wealthiest families remained 2.7 times higher than the income of the poorest households, which was slightly less compared to the advantage the top quintile had a year before, when their income was 2.8 times higher.
In 2016, household expenditure increased by 9.2% with food expenditures going up by 7.1% and non-food expenditures rising by 10.5% and, therefore, steadily recovering from a 12-percent plunge of 2015. This led to the restoration of a long-term trend towards the spending pattern with a significantly greater proportion of non-food expenditures, disrupted in 2015. As the share of food expenditures started to decline again, going down from 41.5% in 2015 to 40.5 in 2016, the spending gap between wealthy and poor households also became narrower. While the households of the top quintile spent on food and non-food products 6.2 times more than the households of the lowest quintile did in 2015, this gap contracted to the sixfold difference in 2016.
In 2016, the household possession of consumer durables further increased. Compared to 2015, the proportion of households with a «No Frost» refrigerator rose from 60.8 to 61.7%, with a washing-machine of the latest generation — from 80.8 to 82.7%. Despite the creeping stagnation of the national car market, the share of households with at least one car or truck increased from 44.2 to 45.2%. Meanwhile, the share of households with personal computers reached 68.4% in 2016.
In 2016, there was a number of positive trends in the labor market. While the general unemployment rate grew from 4.8% in 2014 to 5.5% in 2015, it declined to 4.7% in 2016 with unemployment going down to 4% for males and to 5.6% for females. However, the male participation in the workforce also decreased from 85.2% in 2015 to 84.7% in 2016, while the female participation scaled back from 79 to 78.4%. The number of working male pensioners grew from 19.3 to 20.7%, while the number of female pensioners staying in the workforce contracted from 25 to 24.1%.
Between 2015 and 2016, the relative proportion of male wage earners increased from 42 to 42.6% in private and public-private companies and from 29.1 to 29.9% in state enterprises. Meanwhile, the relative proportion of female wage earners fell slightly, from 32 to 31.9% in private and public-private companies and from 35.9 to 34.3% in state enterprises. In 2016, women earned 74.4% of male work-related income, which was a tiny increase in comparison to 74.1% in 2015. The gender gap in earnings amounted to 75% in private and public-private companies, to 76% in public sector and to 59% in informal employment.
In 2016, the number of workers who had wage arrears decreased. While between 2014 and 2015 the proportion of employees who were to receive back pay grew from 2.5 to 2.8%, in 2016 their numbers contracted to 1.8%, reaching an all-time low. In 2016, 78.2% of workers waited for the payment for a month or less, while an average amount of money due in back pay decreased by 1.3%.
The share of households struggling to pay rent and/or utility bills went down from 8.4% in 2015 to 7.9% in 2016. However, an average amount of money due skyrocketed by 43.3%, which stood in stark contrast to the moderate increase of 5.4% in 2015.
In 2016, there seemed to be little change in terms of personal well-being and life satisfaction. The proportion of those generally satisfied with their life fell from 49.6% in 2015 to 48.1% in 2016, although the share of those unsatisfied rose only slightly, from 26.4 to 26.7%. The level of income satisfaction also went down as 60.7% of respondents were more or less unhappy with their financial standing, which was a 2.7-percent increase in comparison with 2015. Moreover, the share of those satisfied with their finances dropped from 23.8% in 2015 to 20.2% in 2016. Nevertheless, the general outlook on future prospects hardly became much grimmer. Although, between 2015 and 2016, the share of optimists fell from 20.7 to 19.7%, the proportion of pessimist also declined from 18.1% to 15.4%.
The number of people considering unemployment a serious threat to their economic well-being continued to rise, however, at a slower pace. In 2015, 64.3% of respondents expressed concerns about long-term job security, while only 23.1% felt reasonably confident about it. In 2016, the proportion of those concerned went up to reach 65.4%, while the proportion of those who felt more or less confident fell to 21.8%. At the same time, respondents became less anxious about their chances to find a new job. The share of those confident in success stabilized at 36.6%, while the proportion of those who doubt their prospects went down to 43.8%, decreasing by 0.4% compared to 2015.
While looking for a new job, respondents were the most likely to enlist the help of friends and acquaintances, however, the share of those who had a preference for this kind of a job search dropped from 86.6% in 2015 to 79.8% in 2016. More people opted for an online search (53.8% in 2016 compared to 52% in 2015) or contacted companies directly (44.5% in 2016 but 43.4% in 2015). Significantly less people approach relatives or state and private employment agencies while looking for a job (the proportion of the former dropped from 49.4% in 2015 to 40.6% in 2016, the proportion of the latter plummeted from 34.2 to 12.1%).
In 2016, the rise in job satisfaction, interrupted a year before, successfully resumed. The share of workers fully or relatively satisfied with their jobs went up from 65.6% in 2015 to 68.2% in 2016, while the share of those unsatisfied decreased from 11.3 to 10.1%.
The volume of social capital accumulated in various social networks seemed to be relatively high for the majority of respondent in 2016. Although about 83% of respondents weren’t ready to trust people in general, leastways, to do this unconditionally, they often found colleagues and managers rather trustworthy. Respondents actively communicated with relatives and friends, took part in online networking and believed that they could readily enlist the help of relatives, friends and colleagues, and, occasionally, online friends in a difficult situation. Gender, age, the level of education and the place of residence significantly affected the differentiation of social capital. Working-age parents appeared the most likely to provide financial aid to their children, residing in another household. Although the monetary value of aid dropped between 2013 and 2015 due to the economic crisis, the relative financial burden on donors increased, so did the dependence of recipients.
Level of implementation, recommendations on implementation or outcomes of the implementation of the results
The database “Russia Longitudinal Monitoring Survey of HSE” (RLMS–HSE), 1994–2016, with documentation in Russian and English, is publicly available at http://www.hse.ru/rlms. In 2017, 92 papers in Russian and English were published using the RLMS-HSE database (the full list of publications is available at http://www.hse.ru/rlms/2017).