Page 12 - RusRPTMay19

average incomes depend heavily on if a region is a mineral producer and nominal incomes in many of the oil and metal producing regions are well above the national average, although so is the cost of living.
In Russia’s second largest city St Petersburg the share of the middle class decreased from 58% to 51%, and in the other millionki (cities with more than one million inhabitants) from 61% to 49%. In smaller regional cities the share of middle class fell from 56% to 45%. The proportion of people with low incomes increased from 34% to 45%, from 34% to 48%, and from 39% to 51%, respectively in each of these regions.
According to Rosstat, real incomes of Russians have fallen for five years in a row between 2014 to 2018 and remain below the level of pre-crisis 2013. The fall in real incomes has been biggest in Moscow, also by far the richest city.
If at the end of 2017, real incomes of all Russians were 11% lower than in 2013, then Muscovites saw their real incomes fall by 21% in the same period. In 2010, the nominal incomes of Muscovites were 2.5-times higher than those of other regions, and in 2017 - 1.9 times.
The survey showed that 32% of Muscovites and 43% of residents of other regions have no savings, 7% of residents of the capital and 12% of other Russian citizens are burdened with debts.
The Ministry of Economic Development in the adjusted forecast of socio- economic development expects real income growth in 2019 by 1%, then its acceleration to 1.5% in 2020 and in subsequent years to 2.2-2.4%.
2.1 Watcom
Watcom shopping index starts 2019 on a low note, outlook for shopping in malls remains subdued
Russia’s Watcom Shopping index got of to a lacklustre start in 2019, repeating the lower levels of foot traffic in Moscow’s leading shopping malls that were seen last year. if the trend continues then the index suggests there is a permanent reduction in volumes of shoppers visiting big malls as other distribution channels eat into traditional organized retail’s share of the market.
The holiday shopping season gave Moscow’s leading malls a boost in December, but overall traffic in the leading malls in 2018 was the lowest since the index was established in 2014.
Malls are having to make more of an effort to attract customers, using events and targeting families with offers of childcare and entertainment to pull the punters in. Having picked the US Thanksgiving “Black Friday” idea, in Moscow this was extended to “Black December” with a whole month of discounts and specials, that lifted traffic somewhat. But overall the Watcom Shopping Index in 2018 was down by 5.2% compared to 2017.
12 RUSSIA Country Report May 2019 www.intellinews.com