14.04.09

Reduction of income and increase of unemployment have not changed the stereotype of Russians’ consumer behavior. According to data provided by Federal Service of State Statistics (Rosstat) on socioeconomic status in Russia for January-February 2009, citizen’s spending on products and services has not changed in any significant way, despite the economic crisis, -. Experts explain that although the content of consumer goods basket is changing, nominal expenditures connected to filling it are not.

During the first two months of the current year, the real value of the population’s cash income  has decreased by 7.2% in comparison to the same period last year. This decrease of income is also more significant since income had grown by 9.5% during the first two months of 2008 compared to the previous year. Russians cannot help but to feel the salary decrease. While in January-February 2008 (compared to the same period of 2007) salaries grew by 13.7%, in first two months of 2009 salaries increased only by 1%. Moreover, many are facing the prospect of losing their jobs. According to Rosstat’s data, 6.4 million people are unemployed – which is 21.8% more than in February 2008.

Nevertheless, according to the latest report, increased unemploymentand the decrease in income did not have a significant effect on Russians’ consumer behavior. Retail turnover for January-February 2009 compared to the same period of 2008 grew by 0.3%. Volume of services purchased during the same time decreased but only by 0.2%. In 2008 (compared to 2007) the increase of turnover in retail sales and purchased services amounted to 17.2% and 7.9% accordingly.

Economists believe that this radical slowdown of retail sales dynamics is only temporary. People only “rearrange” the consumer basket by, for example, purchasing Russian analogs instead of imported goods. Thus volume of sales remains the same. The volume of paid services also could not decrease very much since people who invested in themselves before (by purchasing medical treatments or investing in education) are ready to support their investments as much as possible. For the most part people of the upper class preserve their usual lifestyles. As for the more vulnerable middle class, it has not lost its savings yet, and did not adjust its consumer psychology.

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Source: Rbc