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. Last Updated: 07/27/2016

Economic Growth Is Fueling Incomes

Incomes are on the rise across the nation thanks to the booming economy and the government's better management of subsidies to the regions, a government watchdog reported.

The number of regions where average residents earn less than subsistence-level incomes dropped from 41 in January 2000 to 16 in the third quarter, according to a study by the Labor Ministry's All-Russian Center of Living Standards.

Regions such as Leningrad, Voronezh, Omsk, Tver and Pskov have managed to climb over the poverty threshold, which averages 800 rubles to 1,000 rubles a month depending on the region, center head Vyacheslav Bobkov told the Trud newspaper.

The study by the center compared average incomes in all 89 of Russia's regions except Chechnya, which was omitted due to a lack of statistical data from the war-torn area.

However, the study found that most of the 50 regions whose residents now earn more than subsistence-level incomes are still rather poor compared to Moscow and resource-rich areas like the Yamal-Nenetsk autonomous district and the Khanty-Mansiisk autonomous district.

Muscovites are considered the best off with average incomes of 1,100 rubles a month, well above the government-decided subsistence level income of 882 rubles. Residents in the two autonomous regions also bring home incomes much higher than their regions' minimal levels.

Bobkov credited local administrative efforts to develop market economies, support small business and create investment friendly environments for the higher incomes of the residents in the more affluent regions.

Most of the residents in 16 regions, however, remained below the poverty threshold, with Ingushetia ranking as the poorest, the All-Russian Center of Living Standards said. The average residents of Ingushetia, which borders Chechnya, earns 561 rubles a month, far below the subsistence level of 1,500 rubles.

Bobkov also said that the gap between the country's richest 10 percent of the population and poorest 10 percent narrowed slightly compared to 1999. Still, the richest segment earns 14.3 times more than the poorest, he said without giving comparative figures.

Some observers agreed that Russia's economic growth of some 7 percent in 2000 was fueling a rise in household incomes but cast doubt on the validity of some of the figures.

Felix Eigel of the EA-Ratings agency said that real incomes could easily be 30 percent higher than reported by the Labor Ministry's center since many Russians work in the so-called shadow economy and, thus, either fail to declare their incomes or underestimate them to avoid taxation.