By Vestnik Kavkaza
The outflow of capital from Russia has exceeded all expectations and amounted to more than 150 billion dollars in 2014, according to the data of the Central Bank of Russia. In 2014 foreign capital markets closed to Russia, new sanctions were introduced and oil prices fell. Former Finance Minister Alexei Kudrin predicts that for the first time since 2000 the real income of Russians may drop by 10%. Certain groups of the population will suffer more than others. "The situation is inevitable, and the government is not capable of preventing, correcting or compensating for it, as happened in 2009," Kudrin said.
The director of the Institute for Social Analysis and Forecasting at Russian Presidential Academy of National Economy and Public Administration, Tatiana Maleva, believes that "the first sphere to be affected by the crisis will be the labor market, since all other processes in the social sphere derive from it. According to the data of the Ministry of Economic Development, in 2015 unemployment will amount to 6-6.5%. Any crisis develops in several phases, we're currently talking about the first phase."
According to Maleva, big cities will be particularly affected by the crisis: "Three major sectors will be most affected by the crisis: import trade, the financial sector, banks and mortage housing construction. But this does not mean that the crisis will begin and end in big cities. In the high-risk level are industries with a high proportion of imported goods and industries with a high probability of depreciation of fixed assets (they will be in need of renovation and investment, which are not available)."
The expert notes that young people left without employment in big cities behave differently from their peers in smaller cities in a similar situation: "The level of self-organization of the population on social issues in big cities is extremely low and I do not expect any social tension, because the population in metropolitan areas is more educated, more adaptable. I don't even think that they will register with employment services. They will not claim their 1,000 rubles benefits, they will not opt for cheap employment programs and employment services. They will use behavioral strategies which correspond to the middle class in the labor market. These people are relatively young and they will not become economically inactive, they will continue to put pressure on the labor market and to produce a high demand for jobs."
Maleva is convinced that unskilled low-paid jobs are unappealing in the current environment not only for young citizens, but also for migrants from neighboring countries: "In December, all the migrants left, and somehow in January they forgot to to come back. The number of those who "forgot" to come back has increased by 70% - the inflow of foreign migrants decreased by 70%, which was to be expected. The devaluation of the ruble makes the country drastically less appealing and dramatically reduces the attractiveness of wages. No social policy can compensate for the loss of income and is not required to do so. Any welfare state will be responsible for the poor."According to the expert, 12% of the population are currently below the poverty line, but this figure could double. "It is possible that the long road to economic prosperity, which Russia has been on for the past 10 years, can be offset in the course of just a year or two," the expert believes.
