It’s no secret that the US has seen disappointing wage growth over the last few months.
Wage growth hit a record low for the second quarter, according to the employment cost index, released by the Bureau of Labour statistics earlier this month. Wages grew by a mere 0.2% — the smallest quarterly gain since 1982 when the series began.
And furthermore, although some large US metro areas saw average wages go up over the last year, about of third of them saw wages drop.
Still, this is nothing compared to the wages the average Russians are seeing.
Over the past year, the country’s economy has been bruised, in part because of the double whammy of collapsing oil prices and economic sanctions over the conflict in Ukraine. And now, it’s the Russian consumers who are feeling the pain.
“Inflation edged up to 15.6% y/y in July from 15.3% y/y in June. And the latest fall in the ruble means inflation will remain higher for longer than previously anticipated. This will prolong the squeeze on households’ real incomes — real wages are currently falling by close to 10% y/y,” Capital Economics’ chief emerging markets economist, Neil Shearing wrote in a recent note to clients.
And with everything that’s going on, it’s hard to tell how soon Russians will see their real wages go up again.