Starting from 2024, the minimum wage will begin to increase at a faster pace than inflation

In subsequent years, the minimum wage (SMIC) will increase at a faster pace, said Deputy Prime Minister Tatyana Golikova during an expanded meeting of the collegium of the Ministry of Labor and Social Protection of the Russian Federation.

“We made a decision, and this decision was supported by both the President and the Prime Minister. The decision that in all and subsequent years the minimum wage will increase at a faster pace,” she said.

The federal budget for 2024-2026 will be formed soon, Golikova recalled, adding that in this regard, “it is necessary to decide” on measures to support the population. She also added that, by decision of President Vladimir Putin, from January 1, 2024, the minimum wage will be indexed by 18.5% and will amount to 19,242 rubles. Thanks to this, salaries will increase for 4.8 million Russians.

On March 6, a draft law on raising the minimum wage by 3,000 rubles was submitted to the State Duma. from January 1, 2024. Earlier, at the beginning of this year, Putin instructed the government in 2023 to ensure an increase in the minimum wage “outpacing the growth rate of inflation and the growth of the average monthly wage in the country.”

In December 2022, Putin signed a law establishing the minimum wage at the level of 16,242 rubles. for 2023, this is 6.3% higher than last year. Within the framework of the law, it was assumed that the minimum wage would increase in an accelerated manner and its increase would depend on the growth rate of the subsistence minimum for the able-bodied population in the Russian Federation.

According to Deputy Prime Minister Tatyana Golikova. The minimum wage is one of the important tools in supporting the well-being of the population. Its increase, together with social support measures, will help reduce the level of poverty in the country.

Earlier, Rosstat reported that the number of citizens with incomes below the poverty line in 2022 amounted to 15.3 million people (10.5% of the total population) – this is the lowest figure in the entire history of observations (conducted since 1992). However, the situation in different regions is different, the vice-premier emphasized, the scale varies from 4.5% in St. Petersburg to 30.5% in Ingushetia. The federal poverty line in 2022 was 13,545 rubles, but it varies from region to region. Until 2021, the subsistence minimum was used as a criterion, based on the cost of the consumer basket at the current moment. Later, it began to be calculated as 44.2% of the median per capita income for the year preceding the year in which the subsistence minimum was established.

The Deputy Prime Minister added that in 2022, Khakassia, Ingushetia, Adygea, Karachay-Cherkessia, Kalmykia, North Ossetia, Komi, Orenburg Region and the Nenets Autonomous Okrug did not achieve poverty reduction indicators. And in Ingushetia, Khakassia, Adygea and Tuva, its growth was recorded.

“The minimum wage, on the one hand, has a greater impact on salaries in the public sector, but on the other hand, it is a trigger that raises the overall level of salaries in the country. In the current conditions, there is some competition between the public sector and the non-public sector – a change in wages in one leads to a change in wages in the other,” said Alexander Shirov, Leading Researcher at the Department of Macroeconomics, Policy and Strategic Management of the GDP of the Russian Academy of Sciences.

Don’t expect radical change, he warned, but as “one of the factors” in the general level of improvement in the well-being of the population, “it works.”