Inequality of Minimum Wages in Former Soviet Union: An Updated Look in 2014

It has been six months since I last analyzed the minimum wages in the former Soviet Union. Although it is not a major factor in economic growth, the minimum wage is still a relevant indicator in understanding a country's economic status.

In my previous research in 2013, I found that Estonia had the highest minimum wage of $427, while Kyrgyzstan had the lowest at just $17 per month. In this updated analysis for 2014, the highest minimum wage is still in Estonia, with an increase to $480, and the lowest is still in Kyrgyzstan, but with a slight decrease to $16 per month.

The Baltic States, specifically Estonia, Latvia, and Lithuania, remain at the forefront of the minimum wage table. The gap between Estonia and Lithuania is a substantial $89, indicating significant differences even among countries in the same region. It is noteworthy that minimum wages in some countries, such as Russia, Kazakhstan, Ukraine, Moldova, Georgia, Tajikistan, and Kyrgyzstan, have decreased instead of increased. However, it is not necessarily due to the government's decision to cut down the minimum wage, but rather the devaluation of their national currencies against the USD.

Ukraine has experienced the largest decrease in minimum wage, which decreased by 37.5% or $39 per month. This is due to the devaluation of the Ukrainian Hryvna caused by internal problems in the country. Russia has also experienced devaluation against the USD, but it did not significantly affect the minimum wage.

There are still five countries in the former Soviet Union space receiving less than $100 per month, and two of them, Georgia and Moldova, are seeking closer ties with the European Union. In order to achieve this, they need to raise their minimum wages above $100 in the near future. The gap in minimum wages between the wealthiest Baltic States and Central Asian countries remains significant, highlighting the ongoing inequality in the region.

Minimum wage in FSU 2014/2013 ($)

Country 2013 ($) 2014 ($) Change $ Growth %
Estonia 427 480 53 11.04
Latvia 379 432 53 12.26
Lithuania 385 391 6 1.53
Belarus 150 161 11 6.83
Russia 159 158 -1 -0.63
Turkmenistan 154 154 0 0
Azerbaijan 133 133 0 0
Armenia 108 110 2 1.81
Kazakhstan 121 108 -13 -12.03
Ukraine 143 104 -39 -37.5
Moldova 69 64 -5 -7.81
Georgia 54 51 -3 -5.88
Tajikistan 52 48 -4 -8.33
Uzbekistan 40 41 1 2.43
Kyrgyzstan 17 16 -1 -6.25
Average 159.4 163.4