Report - UNDP Russia

average per capita household incomes weredown by less than 1% y-o-y. Monthly regionalstatistics are not very precise and trendfluctuations are very large, so a final assessmentwill not be possible until full-year figures areavailable. However, comparison of salaries,consumer expenditures and development ofretail trade turnover shows rapid shrinkage ofconsumption in oil &gas regions. The same istrue in the Moscow and St. Petersburgagglomerations, and other regions with maincities that have more than a million inhabitants.People in these regions have adapted relativelyquickly to ‘crisis risks; and have changed theirconsumption behavior accordingly.So less steep decline of industrialproduction in fuel industry regions did not sparethem from social impact of the crisis. Budgets ofthese regions, together with budgets of regionsspecializing in metallurgy, suffered more thanothers. Half of fuel & energy regions reportedsharp increases of unemployment. Companiesare cutting costs and jobs are being lost both inthe fuel sector itself and in auxiliary industriesand services. However, it should be noted that, inregions with other industries in addition to fuel,the main contribution to unemployment, andespecially to hidden unemployment (part-timework), came from other industries and not fromfuel & energy.2.5. Summaryand recommendationsIs it possible for wealthy resource miningregions to lead human development? There is noclear answer. Only 2-3 oil & gas producing regionswith the best fiscal capacity have financialresources for upgrading their socialinfrastructures. But these are northern regionswith low population, where higher investmentsin social infrastructure are swallowed up by highcosts of construction and operation of schoolsand hospitals. Besides, high fiscal capacity onlycreates advantages when expenditure prioritiesare correctly defined. Otherwise social problemspile up, as has happened with pre-schooleducation. Rapid growth of budget revenues isnot necessarily accompanied by rapid growth ofsocial expenditures, and this is true not only infuel & energy regions.Sustained development of singleindustrynorthern regions has to contend withFigure 2.9Wage trends (May 2009 vs. May 2008), consumer expenditures (May 2009 vs. May 2008) and retailtrade turnover (H1 2009 vs. H1 2008) in several regions of the Russian Federation, %115Wages Consumer expenditures Retail trade turnover1101051009597100 999695 95 94 94 93 93 939090 9089 89 888580RF national averageRepublic of TatarstanRepublic of BashkortostanPerm TerritoryYamal-Nenets AutonomousDistrictMoscow regionMoscowSamara RegionSt. PetersburgNovosibirsk RegionRostov RegionNizhny Novgorod RegionKhanty-Mansi AutonomousDistrictTomsk RegionOmsk RegionKomi Republic42 National Human Development Report in the Russian Federation 2009