HSE Rector warns the middle class of risk to roll down into poverty

HSE Rector warns the middle class of risk to roll down into poverty
HSE Rector warns the middle class of risk to roll down into poverty
28 April 2020, 11:34SocietyPhoto: miem.hse.ru
The rich even growing poorer will remain rich, but the Russian middle class can slide into poverty, said the rector of the Higher School of Economics (HSE) Yaroslav Kuzminov (pictured).

The shocking impact from the economic crisis caused by the coronavirus pandemic will be taken by the middle class, Yaroslav Kuzminov said in an interview with RBC.

- Most likely, incomes will fall for all segments of the society, but if the impoverished rich will still remain rich people, and the poor will still be poor, then for the middle class, which is now taking the brunt of the burden, there are serious risks of falling into poverty, - acknowledges the expert.

According to him, first of all, the trend will affect the service sector.

The HSE has developed a forecast according to which, under the barch scenario, the unemployment rate in Russia will remain at 8% this year. The most significant losses will be incurred by the unincorporated sector of the economy.

“The corporate sector will lose 700 thousand workers in 2020 against one and a half million people in the unincorporated sector, but then the recovery is faster in the unincorporated sector,” Kuzminov said.

Under a pessimistic scenario, the unemployment rate will rise to 9.5% in 2020, and in 2021 it amounted to 9.8%. In both sectors, recovery growth should be expected no earlier than 2022.

At the same time, the HSE rector pointed to the widespread willingness to sacrifice economic growth for the sake of saving lives.

- We moved on to a different reality, to a different correlation of morality and economy. For the first time, the world stopped its economy, went on the loss of 5-7% of global GDP in order for people - elderly people, sick people - to live 3-5 years more. I believe that this is a colossal moral movement, ”Kuzminov said.

It should be noted that earlier academician Abel Aganbegyan emphasized that today in Russia there is no project to reduce poverty - it has not even been developed. The academician noted that 65% of poor Russians are working people.

To date, the number of patients with coronavirus in the world has exceeded three million. 208 thousand patients died from the disease. Over 878 thousand infected managed to recover.

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