The remuneration growth cannot keep up with the dollar exchange rate in the regions

The increase of the dollar exchange rate offsets the growth of remuneration. Within half a year remuneration in the country increased by USD 10-25 on average depending on the region. Promises of the authorities to increase average remuneration up to USD 700 by the end of the year are implausible.

A new tendency faced by Belarusian enterprises – a delay in remuneration payments. So far this is typical only of agricultural enterprises and small private companies. Still, even the 10-day delay triggers spontaneous protests of employees who refuse to work. For example, employees of a private garment manufacturer ‘Supermayk’ in the Brest region in the town of Gantsevichi organized a sit-down strike because of the delays in remuneration payments in June. It is noteworthy that remuneration in this enterprise is extremely low: BYR 1.2 – 3 mln. A similar situation can be witnessed in other regions, too. In the Mogilev region in 40 organisations remuneration payment in the amount of BYR 5 bn was delayed in January-April this year.

In general, the situation in the country as regards remuneration looks as follows:

Average monthly remuneration by regions and in the city of Minsk,

the data by the National Statistics Committee

The Grodno region stands out in terms of real wages growth. In June 2013 compared to June 2012 the growth of wages amounted to 118.5%. Still, in accordance with the official data, among all the locations in the Grodno region, average remuneration was above average across the country only in the regional centre.

Thus, the gap between centres which can provide for the remuneration growth and the rest of the regions is growing. In the mid-term perspective this increases the risk of organized discontent among the population. The minimum payment delay may provoke spontaneous employee protests. For more details see the previous issue of the Monitor.

The Minsk region

In the first half of 2013 average monthly remuneration in the Minsk region amounted to BYR 4777 thousand while in June this indicator exceeded five million rubles and amounted to 5133 thousand.

During the first six months the level of average remuneration in the Minsk region was a little higher (0.1%) and in June – a bit lower (0.5%) compared to the indicators across the country.

At the same time, average remuneration in the Minsk region during the first half of the year and in June was above this indicator in other regions of the country and was only lower than that in the capital. Moreover, in January-June the lowest rate of real wages increase was observed in the region compared to the same period of the previous year and compared to other regions and the city of Minsk – i.e. 119.1%.

In terms of remuneration, the Soligorsk and Minsk rayons as well as the regional city of Zhodino are traditionally ahead of others among the rayons (counties) of the region. The results for January-May indicate that average monthly remuneration there amounted to BYR 7276 thousand, BYR 5653 thousand and BYR 5117 thousand, respectively.

The data for the first quarter of the year 2013 indicate that the highest level of remuneration was observed in chemical (BYR 12181 thousand) and metallurgical (BYR 7203 thousand) industry, mining (BYR 6200 thousand) and processing (BYR 6024 thousand) as well as construction industry (BYR 5659). Remuneration in manufacturing (BYR 5812 thousand) was above monthly average.

Remuneration in agriculture (BYR 3352 thousand), public catering (BYR 3217 thousand), healthcare (BYR 3406) and education (BYR 3018) was below average in the region.

There are no reasons to believe that the above remuneration structure in different sectors in the region changed somehow according to the results of the first half of the year 2013.

Information about the level of wages in individual enterprises is very rarely made public, still, based on implicit data, one may draw a conclusion that average remuneration above BYR 8000 thousand was reached in certain enterprises in the region in June 2013. The latter clearly include ‘Belaruskali JSC’, ‘Heavy die forging factory JSC’ and ‘BelAz JSC’.

The Gomel region

In January-June 2013 average nominal monthly wages in the Gomel region constituted BYR 4560.3 thousand, which is 1.44 times higher compared to January-June 2012. Moreover, in organisations of the budgetary sector they amounted to BYR 3352.8 thousand and grew by 1.28 times compared to the same period in 2012.

Gomel regional authorities face the challenge of bringing average remuneration up to USD 662 by the end of 2013. In early July it amounted to BYR 4 905 472 (third largest average remuneration following Minsk and the Minsk region). These plans can indeed be fulfilled despite the fact that the remuneration growth still exceeds the growth of workforce productivity. The growth of real wages reached almost 16% per annum while the growth of workforce productivity in terms of gross domestic product compared to the respective period of the previous year did not exceed 3%.

Five leading rayons in terms of remuneration have remained the same: the Mozyr rayon with its nearly BYR 5.7 mln holds the leading position. Next come the Rechitsa and Zhlobin rayons, the city of Gomel and the Svetlogorsk rayon. The Loyevo rayon with its nearly BYR 3.5 mln turned out last. The ‘poorest’ Kormyany rayon according to the results for the first quarter of the year moved to the last-but-one position.

In the Gomel region, similarly to entire Belarus, average remuneration of employees in the sector of culture, trade, agriculture, teaching, healthcare does not reach the average level for the region. The problem won’t be solved by the increase of tariffs (rate of pay) for schoolteachers, teachers of additional training, teachers of vocational and secondary special education by 25% since September 1 in accordance with the Regulation of the Council of Ministers No. 689. (The remuneration increase stems from the increased norm of teaching load).

On the other hand, in enterprises such as the Mozyr refinery, Belarusian iron-and-steel works, Svetlogorsk Production Association ‘Khimvolokno’, Production Association ‘Belorusneft’, Production Association Gomel chemical plant, ‘Gomelsteklo’ JSC, Production Association ‘Gomselmash’ and several others remuneration is close to BYR 7 mln while in certain enterprises it has exceeded BYR 8 mln. Employees of some of the departments of design offices as well as computer scientists receive about BYR 7-9 mln.

Average gross payroll (including all the fringe benefits, bonuses etc.) in the region looks as follows:

Oil-production enterprises – about BYR 8 mln. Maximum BYR 11-12 mln

Oil refineries and metallurgy – up to BYR 8.7 mln

Chemical enterprises – up to BYR 8 mln

Banks – up to BYR 8 mln

Construction – BYR 6 mln

Transport – BYR 5.1 mln

Science – BYR 5.0 mln

Medicine – from BYR 2.8 mln in outpatient clinics to BYR 6.5 mln in clinical centres.

Education – from 2.5 mln in schools up to BYR 6.5 mln in institutions of higher learning

Agriculture – about BYR 3 – 3.5 mln

Culture – about BYR 2.3 – 3.2 mln

Thus, currently in the Gomel region remuneration of employees in different areas of activity may differ 5 times.

The Mogilev region

The number of employees who do not receive average remuneration declared by the authorities is growing in the region. Delays in remuneration payments are also growing primarily in the agricultural sector. Our forecast: social differentiation in terms of remuneration will continue to grow in the region. The number of enterprises capable of providing their employees with remuneration of more than BYR 8 mln has dropped and constitutes 1 – 2 enterprises per each rayon in the region. The majority of job offers provide for BYR 2.5 mln up to 3.5 mln of remuneration. For example, remuneration of boning operator at the Glubokoye meat-processing factory amounts to BYR 1.9 mln. A casino stickman in Mogilev – BYR 2.5 mln. A chief accountant – BYR 4 mln.

Let us underline that checks in agricultural entities of the Mogilev region revealed delays of remuneration payments under collective bargain agreements in virtually all the rayons. In 40 orgnisations in January-April this year delays in remuneration payments amounted to almost BYR 5 bn. Numerous cases of remuneration payments without compulsory social insurance fees were also revealed.

All in all, in accordance with the data of the regional statistics committee, average remuneration in the region constituted BYR 4 653 047 in June. At the same time, the geography of the poorest rayons crosses the Mogilev region. Ten poorest rayons include Krasnopole, Slavgorod and Mstislav rayons. Average remuneration does not exceed BYR 4 mln there.

The Grodno region

Average monthly nominal wages in the Grodno region amounted to BYR 4700.4 thousand in June and BYR 4294.5 thousand in January – June 2013. The Grodno region is the leader in terms of the growth of real wages. The remuneration growth in June 2013 compared to June 2012 constituted 118.5%. Still, among all the locations in the region average remuneration in accordance with the official data was above average remuneration across the country in Grodno only.

Top wages are offered in the financial sector at the level of BYR 8.0 mln. Above-average remuneration in the region is offered in construction, manufacturing, electricity, gas or water production and distribution as well as mining, transport and communications, public administration. When studying offered job vacancies in the labour market one can see that the worst paid occupations include education specialists, especially teachers in preschool facilities. On the whole, wages of preschool teachers range between BYR 1.5 and BYR 2.5 mln.

In the Berestovitsa rayon, which is a typical agricultural rayon in the region, the following situation is observed. In June 2013 average monthly remuneration in construction amounted to BYR 5438.7 thousand, in transport and communications – BYR 3869 thousand, manufacturing – BYR 4236.5 thousand, agriculture, hunting and forestry – BYR 4550.9 thousand, education – BYR 2954 thousand. In June 2013 remuneration of employees in healthcare and social services constituted BYR 3 855.9 thousand including healthcare – BYR 4122 thousand.

In accordance with the survey by the popular Grodno Blog s13, 21% of respondents earn from BYR 2 mln up to BYR 3 mln, 18% – more than BYR 6 mln, 18% – from BYR 3 mln up to BYR 4 mln, 18% – from BYR 4 up to BYR 5 mln, 16% – below BYR 2 mln and 9% – from BYR 5 mln up to BYR 6 mln. According to the survey by the Community of Professionals ‘kollega.by’ site, average remuneration of employees registered in the system of the Community of Grodno amounts to USD 456. The analysis of 7000 regional job vacancies in Belarus carried out by the HeadHunter Belarus research centre and РАБОТА.TUT.BY project indicated that Grodno is the leader in terms of the best-paid job offers among Belarusian enterprises. Here the remuneration of minimum USD 2400 and minimum USD 2000 was offered to an IT-specialist and driver this summer.

At the same time, the chairman of the Grodno regional executive committee Semion Shapiro criticised the amount of wages in the football club ‘Nioman’. The key sponsors of the club are the Grodno regional executive committee, the Republican Unitary Enterprise ‘Grodnooblgaz’ and Skidel sugar plant. Monthly remuneration of the head coach of the club Sergey Solodovnikov amounts to BYR 24 mln, while Brazilian mercenary Seolin Nicolas used to earn BYR 32 mln on average.

The Vitebsk region

Average monthly gross payroll of employees in the Vitebsk region amounted to BYR 4 662.8 thousand in June, which is an increase of 35.4% compared to June 2012. In the course of the first half of the year nominal wages amounted to BYR 4 446.2 thousand in the region. Net remuneration in percentage constituted 120.7% compared to the respective period of the previous year. Despite the fact that the Vitebsk region is ‘ahead’ of Mogilev and Brest regions only in terms of the increase in nominal wages, enterprises of this northern region of Belarus hold leading positions in terms of workforce productivity growth. This positive dynamics has undoubtedly been reached thanks to the working results of ‘Naftan’ JSC. Thanks to this enterprise average remuneration in Novopolotsk amounted to BYR 6 667.1 thousand in May this year, which is BYR 1 777.7 thousand higher than in Vitebsk. In June nominal monthly wages of employees in Vitebsk decreased compared to May this year and amounted to BYR 4524.5 thousand. In May the wages constituted BYR 4889.4 thousand. Compared to the same period of last year, the remuneration growth rate in the regional centre amounted to 144.8% in January-June 2013, and 136.8% – in June.

Still, 4 rayons of the Vitebsk region, namely Braslav, Sharkovshchin, Shumilin and Gorodok rayons are among the ‘TOP-10’ poorest rayons in the country. Earlier Ushacha rayon was also on the list. None of the rayons in the region had average remuneration at the level of Vitebsk in May.

Remuneration in rayons and cities of the Vitebsk region are as follows (data as of May 2013)

There are cases of delays in remuneration payments in the region. Thus, in spring this year employees of the construction company in Vitebsk refused to work until they received remuneration for the previous month. Employees of the factory of reinforced concrete structures in the Tolochin rayon (Kokhanovo JSC) did not receive remuneration for a year-and-a-half. The factory is on the verge of liquidation while delayed payments amounted to BYR 225 mln as of May 1, 2013. In May employees of communal unitary agricultural enterprise ‘Kashchinskoye’ in the Chashniki rayon partially received their remuneration in the form of foodstuffs: expensive sausages, canned meat and even mincemeat. In the course of 6 months this year 513 employees left ‘Polotsk-Steklovolokno’ JSC because of the disastrous working conditions. And this was despite the average remuneration of 5 200 000 rubles. Factory employee remuneration constituted as little as 21.8% of the structure of expenses spent on manufacturing during half a year.

In the region 4.9% of employees receive remuneration below BYR 2 mln, 55.8% – up to BYR 3 mln, 23.4% – up to BYR 4 mln, 11.3% – up to BYR 5 mln and 4.6% receive remuneration of more than BYR 5 mln.

Nowadays the TOP-5 most sought-after occupations in the region include engineers, physicians, nurses, veterinaries, zootechnicians. Yet the central outpatient clinic in Orsha offers vacancies of neurologist and cardiologist with the remuneration of BYR 1.9 mln and that of a surgeon – BYR 2.3 mln. A housing and public utilities company in Shumilin offers the remuneration of BYR 2.1 mln to an electric engineer. And a veterinary pharmacy in Vitebsk offers the remuneration of BYR 1.5 mln. There are a lot of vacancies on offer but employees demand decent remuneration and working conditions nowadays.

The Brest region

Average remuneration in the Brest region is still the lowest in the country.

Thus, nominal monthly wages of employees in the region (except small business) amounted to BYR 4.16 mln (in accordance with the forecast by the authorities – BYR 4.17 mln in 2013) in January-June 2013, which is an increase of 39% compared to June 2012.

Real wages (remuneration calculated taking into account the growth of consumer prices on goods and services) compared to the same period in 2012 increased by 22.3% in January-June 2013, and by 2.6% compared to June and May 2013.

Nominal average wages in budgetary organisations constitute a little more than BYR 3.21 mln.

Constantly growing indebtedness of organisations in terms of credits and loans for remuneration payments can be indicated as a negative tendency: the total amount of debt exceeded BYR 231.2 bn (11.8% of the monthly remuneration fund) as of 01.07.2013 while in May and June 2013 the sum of the debts amounted to BYR 215.3 bn and BYR 221.3 bn (respectively). The highest ratio of debts is still the most typical of construction organisations (38% of the remuneration fund), agricultural and forestry business (22.3%) as well as manufacturing enterprises (14.3%).

The average staffing number of employees in organisations of the Brest region (small business excluded) amounts to 435.1 thousand people.

The highest wages (BYR 8 mln and more) are received by employees of the mining Republican Unitary Manufacturing Enterprise ‘Granit’, Republican Unitary Manufacturing Enterprise ‘BLVZ ‘Belalko’, ‘Savushkin produkt’ JSC, ‘Brestgazoapparat’ JSC, Regional Utilities Unitary Trade-and-Manufacturing Enterprise ‘Brestoblagroservice’ as well as employees of the banking sector (total number of 14-15 thousand employees or about 3.4%).

The situation has changed as regards types of activity with the lowest wages: a few months ago employees of the educational sector were the worst paid – BYR 2.81 mln (currently between BYR 3 and BYR 3.5 mln, academic teachers – BYR 5.2 mln) and the same goes for healthcare – earlier BYR 2.93 mln (currently BYR 3.2 mln, of them physicians – BYR 5.49 mln).

Currently the lowest wages are typical of employees of public amenities, hotel and restaurant industry – BYR 2.9 mln (these wages are paid to more than 8.2 thousand employees in the region, the majority of them are employed under fixed-term seasonal agreements).

There are organisations in the region (Utilities Unitary Enterprises of Stolin, Malorita, Lyakhovichy, Luninets rayon public amenities) where remuneration does not exceed BYR 1.9 mln, the total number of employees of these organisations – about 1 thousand people (0.23%).

28 thousand employees (6.4%) of the construction sector receive BYR 5.1 mln. Compared to the same period of 2012, nominal wages in the sector increased by 160%, which is the highest growth rate among all types of economic activity. Thus, the authorities try to prevent construction employees from labour migration to Russia, while the remuneration growth is to a large extent sustained by way of credits and loans.