In the previous two quarters, they increased by 0.2 and 0.6 percent, respectively, and the last quarterly decline in the real income of Russians took place in April-June 2023.
The mood among Russians is getting worse
The Center for Macroeconomic Analysis and Short-Term Forecasts (CMASF) calls this a technical adjustment and suggests it is related to lower interest rates, which have reduced yields on deposits and other financial assets, as well as some “purely statistical” effects at the beginning of the year. The center expects growth to return in the second quarter.
However, as research shows, Russians are increasingly concerned about the state of their personal finances and the country's economy. This is reflected both in research conducted by the Public Opinion Foundation on behalf of the Central Bank, and in other studies, such as those conducted by the Levada Center, according to which the consumer sentiment index has been falling since the middle of last year. and in the first quarter it dropped to 102 points, getting very close to the pessimism zone (the threshold is 100 points).
CMASF is surprised by the “rapid, almost linear decline” in Russians' assessments of their standard of living and economic situation “against the background of generally favorable conditions.” Wages continue to rise in real terms (0.4% monthly on average in the third quarter and 1% in the fourth quarter, according to seasonally adjusted estimates; they remained unchanged in January but increased again by 0.4% in February). They constitute the main real monetary income of the population. Therefore, the center sees no objective grounds for such pessimistic assessments, “which have the character of a 'shift' towards negative values.”
Real wage increase in Russia. A lot depends on the sector
The wage situation, as in the entire economy, is extremely diverse. According to Rosstat data, nominal wages in the period January-February were 15.4 percent higher. higher than in the first two months of 2025. At the same time, in some sectors (coal mining, metallurgy and rail transport) they were lower or barely kept up with inflation, and in the fishing industry they fell by up to 0.4 percent; in others they increased by 20 percent. or more (tourism, finance, IT and administrative services).
CMASF describes real wage dynamics as “the balance between the 'leadership effect' of sectors and areas with rapidly rising wages and financial deficits that limit the potential for further wage growth in most sectors.” The Ministry of Economic Development forecasts an increase in real wages of only 2.2-3%. annually in the current year and in the next three years.
In any case, the “unexpectedly long and deep” decline in Russians' expectations has already become an independent factor influencing social behavior and macroeconomics, CMASF notes. Household consumption is the main driving force of the economy, but it is limited by the ability to increase wages.
According to Rosstat, last year the real disposable income of Russians increased by 7.4%, by 22.7%. over the last three years and by 21.5 percent since the beginning of the war in Ukraine.
