Russia has suffered massively from the economic crisis, going from 8 percent growth in 2008 to a 6.5 percent contraction this year. Unemployment has soard to 10.2 percent, a nine-year high.
Oksana Zagrebnyeva of OpenDemocracy Russia shares her personal account of life in an industrial Russian town hard-hit by the economic slowdown.
Letters from Russia: Lipetsk
I moved to Lipetsk about a year ago. It’s roughly 500 km south-west of Moscow. […]Today Novolipetsk Steel (NLMK) carries on the 18th century Petrine tradition of the ironworks. The owner is Vladimir Lisin, one of the five richest men in Russia. They are the main employer in the city: they occupy a vast area of land and employ about 35,000 people. On top of that many of their components are made to order in small and medium-sized Lipetsk factories, so that accounts for several thousands more jobs.
Lipetsk and its region have felt the influence of the economic crisis more strongly than other cities and regions, because it’s a single-industry city and everything depends on NLMK. They are short of orders, so their employees have felt the pinch too – many of them are not working a full day any more, some are working a short week and others have been retired or made redundant. My friend’s mother worked has had her work cut back, so she’s earning less. Her father worked in a factory which depended on orders from NLMK. When the crisis started he was paid 4,000 ($130) instead of the usual 10,000 roubles ($324). No explanation. There are 4 people in that family, 3 are working. By the New Year their total monthly income had dropped to 30,000 roubles ($971.5), half what it was before the crisis. Many, though not all, have lost 30 – 50% of their income.
My husband worked at the Lipetsk Meat Processing Plant, where he was head of sales. The enterprise ran on credit, as most of them do, and had no working capital of its own. When the banks cut the credit line the directors started streamlining their expenditure by sacking people and cutting wages. My husband was offered the possibility of working for 15,000 ($485.75) instead of 30,000 – or find another job. His last working day there was 31 December. What a way to start the new year!
[…]My husband and I live with his father in a block of flats built as temporary accommodation in the ’50s for workers at the Lipetsk Tractor Plant.
There are 8 flats in the block, which has been condemned – the pipes are in a terrible state, the roof is leaking and there are problems with the electricity. Lipetsk has dozens of buildings like ours: the people living in them are waiting their turn on the regional resettlement programme list. I don’t believe in miracles such as being resettled at someone else’s expense, so I decided to do some repairs to our hovel. It’s said that there’s nothing more permanent than the temporary and, as my mortgage dreams melted away in the crisis and I don’t want to take a flat and pay some unknown landlord rent, we going to put to rights what we’ve got.
On the whole I often think that we live in defiance. In defiance of the crisis, the falling salaries and growing prices, in defiance of the fact that we can’t plan our budget. And in defiance of everything I got married during the crisis – no pomp and ceremony, no banquet, just him and me. During the crisis several of my friends have had babies and others (and I’ll let you in on a secret – me too) are planning to have them. Some friends are intending to buy a house in the suburbs, others want a car and without any favourable credit facilities from the state.
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