No Wage Rise? Then You Got a Real Pay Cut.

(From The Moscow Times)

Those whose dollar-priced salaries rose by less than 7.5 percent in 2005 or whose ruble-calculated wages did not jump the 10.9 percent inflation plank have a lighter pocket in Russia than they did a year ago.

Fortunately for the majority, analysts say that wages in the country have increased substantially in the last year across the social spectrum. How much richer or poorer you feel mainly depends, however, on what you consume and whether you have a second, unofficial income.

According to Economic Development and Trade Ministry figures, inflation for 2005 stood at 10.9 percent. Meanwhile, the nominal ruble wages of the population for the year were up by 20 percent compared with the previous year, and after inflation is factored in -- producing the real wage increase -- average salaries were worth 10 percent more at the end of 2005 than they were 12 months earlier, said Peter Westin, chief economist at MDM bank.

Yelena Matrosova, head of the Center for Macroeconomic Research at consultancy BDO Unicon, put the real wage increase for the first 11 months of 2005 at 9.3 percent, and agreed that "we are seeing a considerable rise in salaries in the last year."

"When you ask most people, they'll say they don't believe these numbers. But the fact is, the average customer check at an IKEA furniture store in Moscow is about the same as the average check at an IKEA store in Sweden," Westin said.

Among the nonprofessional work force, Matrosova said the monetization of benefits lifted the incomes of low-wage earners, pensioners and beneficiaries, while Westin pointed to the 15 percent increase in soldiers' wages, which was announced last week, and the expected 50 percent wage hike for teachers and nurses to be implemented this year.