Relatively recently joined the functional market economies club, although it has multiple pending development (not just economic) issues, Romania looked around and chose a poisonous… Mai mult›
Spectacular GDP growth in Q1: 5%, in the context of rhythm decline in manufacturing to just 1.2%. Dilemmas
Gross Domestic Product for the first quarter of 2019 increased by 5% in real terms compared to the same period of the previous year (5.1%… Mai mult›
Simply put, data recorded over time in the monthly budget implementation published by the Ministry of Finance indicate a share of staff costs in total… Mai mult›
Germany (16.9%), France (11.7%) and Italy (9.5%) are the countries with the largest share in Romania’s economy by the number of employees in 80,905 groups… Mai mult›
Budget implementation in Q1, short and simple: wages and social spending up, general and local investments down, co-financing for projects implemented with European money down
The general consolidated budget recorded, after the first two months of 2019, a deficit of about RON 5.5 billion, equivalent to 0.54% of the GDP… Mai mult›
Q2 / Average monthly income per capita in Romania has risen to nearly RON 1,600: Changes in redistribution of family budget
de Marin Pana , 15.10.2018
They were RON 4,151 per family and RON 1,589 per family member. It is noteworthy that money earned per person increased by almost 29% compared to the same quarter of the previous year, while in-kind incomes declined by about two and a half percentage points.
Significant warning for the sustainability of the income growth over the last four years, the comparison between the advance of a person’s earnings since 2014 (64.3% adjusted for inflation, for a fair comparison) and the 25% GDP growth (including the four percentage points of the first half of 2018) shows a major gap.
- Evolution of monthly incomes of households and individuals in Q2 (RON, 2014-2018)
- Total per household
- Total per individual
- Cash income per household
- Cash income per individual
- In-kind income per household
- In-kind income per individual
Wages significantly consolidated their preeminent position in the total income structure in a household and reached up to 67.5%. The increase in the last four years has been fulminating, with an increase of 16.3 percentage points (pp.), of which almost 40% in the last 12 months analysed by the INS.
In contrast, the share of in-kind incomes had a visible decline, considerable for the fourth consecutive year, and fell to less than half of the value registered in 2014 (7.4% in Q2 2018, compared to 14.9% in Q2 2014). Agricultural incomes also suffered a similar decrease (-44%), down from nearly four percentage points to just 2.2%.
Contrary to public rhetoric, the share of income from social benefits in the total income of a person has also diminished significantly. Out of the six percentage points lost over the last four years, more than half have “evaporated” in the past 12 months (-3.3 pp. between Q2 2017 and Q2 2018). The explanation is that this type of revenue, although on a rising trend, has evolved below the growth level of the wage income.
The evolution reflects a growing integration into the capitalist production relationships, based on the commodity production and the use of employed labour for this purpose, simultaneously with the decrease in the self-consumption share, specific to the feudal society. As well as the pressure to relieve the labour costs from social protection obligations in order to maintain competitiveness.
- Evolution in the structure of total households’ incomes in Q2 (% of the total, 2014-2018)
- Type of income
- Salary incomes
- Social benefits
- In-kind incomes
- Agriculture incomes
- Incomes from independent activities
- Property income and from assets sales
- Other income
Incomes from independent activities (-0.2pp) and incomes from property and asset sales (-0.3pp) declined in terms of their importance in the family budget but at a slightly more weighted rate, while the amounts from other expediencies reduced by one third their relative importance (from 1.8% in Q2 2014 to 1.2% in Q2 2018).
How costs have been redistributed
Money saved as a result of lower food prices (more than six percentage points as a share in total) were redistributed mainly to clothing and footwear (+2.3 pp.) and to furniture, endowment and home maintenance (+1.9 pp.). It is noteworthy the diversification of products and services accessed by the population (the share increased considerably in the last four years, from 3.8% to 5.2%).
This evolution reflects an increasing convergence with the Western lifestyle, as the incomes increase. Changes in the structure are a proof of an improvement in the living standards (material and quantitative, rather than spiritual and qualitative), despite the relatively frequent clichés that the current economic growth would not be felt in the population’s pocket.
It should also be noted that, in the context of robust wage increases meant to stimulate the domestic demand, the income growth has led to a significant reduction in the importance of the spending on housing, water, electricity, gas, and fuels, the second important cost group, which had reached a local maximum level in 2015-2016.
- Evolution in the structure of the consumption spending in Q2 (% of the total, 2014-2018)
- Type of consumption
- Agrifood products and non-alcoholic beverages
- Alcoholic beverages and tobacco
- Clothes and footwear
- Housing costs, water, electricity, gas and fuels
- Furniture, endowment and home maintenance
- Leisure and culture
- Hotels, coffee shops, restaurants
- Various products and services
*Unfortunately, an aspect that needs to be analysed very seriously by decision-makers, health has moved around in circles and education has seen a decline in the share of a family budget.
That, in spite of the fact they did not hold anyway a very important spot before either. Furniture and various products and services might be modern and useful, but the reversal of the relative importance in relation to health should give food for thought.
Lăsați un comentariu
The National Bank increased the inflation forecast for 2019 by 1.2 percentage points, from 3% to 4.2%. Also, the forecast for 2020 goes up by… Mai mult›
Emergency procedure at European Court of Justice for Romania’s question: Are MCV recommendations mandatory?
The Court of Justice of the European Union (CJEU) has decided that Bihor Court’s request to be discussed under the emergency procedure, which is a… Mai mult›
Government decides to increase external borrowing ceiling by EUR 4bn. It has consumed program resources for two years
The Government's agenda for Wednesday also includes the draft decision to increase the foreign loans ceiling for 2019 and 2020 by EUR 4 billion, up… Mai mult›
On Tuesday, the European Commission presented a series of policy recommendations on how Europe can shape its future within an increasingly uncertain and multipolar world.… Mai mult›
Meeting between Prime Minister Viorica Dancila and Chinese Prime Minister Li Keqiang: talks on a possible involvement of Chinese companies in PPP projects in Romania
On Friday, Prime Minister Viorica Dancila had a meeting with Chinese Prime Minister Li Keqiang, during which she stated her interest in involving Chinese companies… Mai mult›
So-called "Belina Law" was adopted. Opposition will refer CCR: it turns Belina Island into a fiscal paradise
The Chamber of Deputies adopted on Tuesday the bill that provides for a derogating tax regime, such as tax exemptions or reductions, for land and… Mai mult›
Deveselu shield is undergoing an upgrade process; the US provides alternative defence capabilities with THAAD systems
Aegis Ashore anti-missile system installed at Deveselu 99 Military Base will go in the next period through a previously planned upgrade process, the MApN announced… Mai mult›
How 2019 began: Investments, allocations by 78.5% lower than the same period of 2018. 21% decrease in co-financing for attracting European funds
The consolidated general budget recorded a deficit of 0.5% of GDP in the first two months of 2019 namely RON 5.2 billion, a "performance" only… Mai mult›
Romania's GDP exceeded Portugal’s in 2018: which has a population two times lower and a GDP/inhabitant twice as high
Romania's economy exceeded, at current prices in euros, Portugal's economy in 2018, a country with a population and a surface two times smaller as Romania.… Mai mult›
The Ministry of Public Finance published Tuesday evening, a day and a half before the approval in the Government, the draft OUG that amends the… Mai mult›
The Justice Ministry has prepared the two OUG drafts for which the coalition has put much pressure on the Justice Minister Tudorel Toader before granting… Mai mult›
ECOFIN / Tax havens list has been updated. Politico: Eugen Teodorovici took EU Finance Ministers by surprise
Finance Ministers of the EU voted on Tuesday at the third meeting of the Council for Economic and Financial Affairs (ECOFIN) chaired by Romania, the… Mai mult›
Dozens of companies, mayoralties, sports teams, public figures, organizations and many ordinary people joined the protest "Romania wants motorways". Of course, the country did not… Mai mult›
Facebook announced Thursday that it has closed hundreds of false accounts promoting false content in the UK and in Romania and this is the first… Mai mult›
Laura Codruta Kovesi was indicted on Thursday in a second case. The section for investigating the crimes committed by magistrates accused her of having led… Mai mult›