Population income and expenditure

 

Income of the population is accrued in kind and in cash and includes the following: wages and salaries (including the ones received from abroad) profits and mixed income, income obtained from property, social allowances and other current transfers.

Disposable income is the maximum amount of income meant to be used by households for purchasing consumer goods and payment for services. They include wages, profits and mixed income, income balance from ownership, social allowances, other current transfers obtained in cash excluding the paid ones, namely current taxes on income and property.

Expenditure and savings of the population include: expenditure for purchasing goods and services; property income paid, current taxes on income, property and other current transfers paid; accumulation of fixed capital and tangible current assets and increased financial assets as deposit savings, savings in hard currency, etc.

Nominal wages relate to remuneration in cash and in kind paid to employees for time worked or work done. It also includes base wage rates (official salary), bonuses, additional payments, allowances and other kinds of payments for time not worked. Nominal wages include compulsory deduc­tions from wages of employees: income tax from natural persons, and single social contribution.

Nominal wages do not include the following:

cash security for professional servicemen, and soldiers and officer personnel;

payments from social insurance funds for temporary disability;

payment for the first five days of temporary disability of employer funds;

sum of employer contribution to the compulsory state social insurance.

Tables 18.5–18.11 provide average monthly (for a year) nominal wages of employees defined by dividing the annual wages by the average annual number of employees and by twelve months.

Indicator is compiled by using data from the state statistical survey that cover enterprises, establishments, organisations (legal persons and separate units of legal persons, next – enterprises) employed wage labour. Till 2010, by businesses without employees of statistically small businesses.

Since 2010 new methodical basis for sample frame design was introduced into the labour force survey. In this context, large and medium enterprises with average number of 50 and more employees (including non-staff members) are subject for exhaustive survey, while enterprises with 10–49 of employees are surveyed at the sample base.

Table 18.5 gives the time series for average monthly wages in 1940–1994. Prior to 1991 (inclusive), the development of statistical indicator for the size of the average monthly wages has been separately made for the categories of employees and workers, and employees of the collective agricultural enterprises (CAEs). Since 1992, on the basis of Ukraine’s Law On Employment and other national legislative acts, the common methodology for statistical recording of the basic indicators has been developed. The indicators characterize the social and labour relationships and the results stemming from the labour activity both of employees and workers, and employees from CAEs.

Nominal wages index reflects the nominal wages change in the reporting period compared with the base one. Due to modifications taken part starting from 2010 survey direct comparison of its data with the similar data from the previous surveys is not correct. The calculated data presented in the tables are computed on the basis of comparative totals by using a chain index.

Index of real wages shows the changes in the purchasing power of the nominal wages that occur during the reference period. It is compared to the base period. It is calculated by dividing the index for the nominal wages which excludes income taxes of natural persons and compulsory state payment to the social insurance during a certain period by CPI for the same period.

Household living conditions sample survey is the main source of data on the living standards of the population and its selected sections, the structure of household income and expenditure, consumption of food and services depending on the level of well-being, composition of households and other social and economic characteristics.

Since 1999 Ukraine has been conducting this sample survey. It is a continous survey based on international standards that meet current social and demographic situation in Ukraine.

Household is a group of individuals who live together in a dwelling or its part and make common provision for living, keep a house, are completely or partially united and spend common funds. These individuals can be in blood or  in-law relationships, be entirely unrelated or be in both of them. Household can consist of one person (Article 1 of Ukraine’s Law on Population Census).

Households participate in the survey for one year.

The survey is conducted every quarter in all regions of the country and covers all

population excluding those in active armed forces, imprisoned, persons residing in boarding houses for the aged, and marginal sections of the population. The design of the sample survey excludes contaminated areas (isolated and eviction areas).

Since 2004, household living conditions survey covers dwellers in all hostels (for families, students, etc). In 1999–2003, only dwellers in family hostels were surveyed.

In 2013 the initial sampled population of the survey included 13023 households. During the year 10528 households took part in the survey (selected addresses accounted for 82,7%, excluding non-resident dwellings). The results of the sample survey are extended through the statistical weighting procedure to the total population.

Since 2007, the studies of the household well-being are based on income indicators; before 2007 expenditure indicators were used.

Monetary expenditure of the households comprise: expenses for purchasing foodstuffs, alcoholic drinks and tobacco products, non-food items and services, expenditure associated with keeping a private subsidiary agriculture, rendering assistance to relations and other individuals, constructing, major repairing of dwellings and utility rooms, purchasing of livestock, horses and perennial plantings for private subsidiary agriculture, acquiring shares, certificates, hard currency, making deposits with banks, paying maintenance and taxes (excluding income tax), duties, contributions, etc.

Total expenditure consist of monetary expenditure and value of consumed by household agriculture foodstuffs that were privately produced or given by their relatives or their other individuals, benefits and non- cash subsidies meant to pay for housing, communal utilities and services, benefits for telephone calls, travelling in transport, health goods and services, tourist services, places in

sanatoria, etc. Value of privately produced foodstuffs given by households to their relatives and other individuals is included into the total expenditure since this assistance occurs in a regular arrangement.

Monetary income of the households includes cash and in-kind (in monetary terms) revenues that household members received as labour compensation (excluding income tax and compulsory payments), income from entrepreneurship and self-employ­ment, property income as interests and dividends, income from selling shares and other securities, revenues from marketing real estate, private and household property, livestock, privately produced agriculture foodstuffs, procurement on own behalf by own  resources, social benefits (benefits and subsidies in cash meant to pay for housing and communal services, electricity and fuel, compensations for the unused sanatorium-and-spa treatment entitlement, travel privileges for some categories of citizens), monetary assistance received from relatives and other individuals, and other monetary income.

Total income incorporates monetary income, value of the consumed output produced at a private subsidiary agriculture (excluding expenditure for output) as procurement on own behalf, benefits and subsidies meant to reimburse communal services, electricity and fuel, non-cash subsidies meant to pay for health goods and services, tourist services, places in sanatoria, etc, benefits for travelling in transport and communication and also value of foodstuffs given their relatives or other individuals.

Total resources includes total income and the sum of the used savings, increased loans, credits, debts that households have acquired as well as debts paid off to households. This indicator shows the potential

household resources that were obtained during the reference period regardless of the sources from which they had been derived.

Subsistence level is the amount sufficient to ensure the normal functioning of the human being’s organism, preservation of its health, a set of foodstuffs, and a minimum set of non-food items and a minimum set of services which are necessary to satisfy the basic social and cultural needs of an individual.

Quintile coefficient for differentiating the population expenditure is a ratio between minimal expenditure that 20% of the most well-off population have and maximum expenditure that is enjoined by another 20% of the low-income population.

Quintile coefficient for funds is a ratio of the total expenditure between 20% of the most well off population and 20% of the low-income population.

Since 2011, when calculating per capita average indicators for expenditure and resources as well as indicators for differentiation of the population and households by level of material welfare according to modern international practice, a scale of equivalence was used which reflects a decrease in minimum necessary wants per one member of household due to increase in size of households and changes in its composition. Since 2000, to ensure time series comparisons, the indicators for differentiation of the population and households by level of material welfare have been revised with due account for the scale of equivalence.

Since the survey is completely new, all its components starting with the sample design and up to the system of analytical indicators are also new. It is not recommended to make comparisons with data from sample survey of family budgets which was conducted up to 1999.