INCOME AS ONE OF THE WELL-BEING FACTORS OF THE POPULATION OF UKRAINE: CURRENT STATE

Abstract

The paper aims to analyze the Ukrainians income structure, to study of the ratio of real, nominal wages and the consumer prices index; to draw a scatter diagram, which makes it possible to make assumptions about a logarithmic nature of the relationship between indicators of average annual wages and GDP growth per capita by countries; to study the correlation between average annual rates GDP growth per capita and wages based on correlation-regression analysis; to determine the ways to improve the well-being in modern conditions. The living standard of the population is one of the main socio-economic categories that not only characterizes the material well-being of a person, but determines the overall result of the country's economy for a certain period as well. Satisfaction of needs has always been a vital condition of people's life. Material well-being with the income as focal point is a key factor in the population living standard analysis. All people work for the sake of obtaining an income that satisfies their needs, and, under favorable conditions – enjoy saving some income, investing in assets, being engaged in charity. The amount of income is often insufficient to meet the most important human needs. Currently, the majority of Ukrainians live below the poverty line, and the skilled workforce has emigrated abroad. Therefore, there arises the need for state regulation of wages, for reducing the disparity in income between the rich and the poor, for searching other sources of income for the population. The issue of the formation of incomes has been studied by many outstanding scientists, but the issue of formation of the population income as one of the factors of the population well-being has not lost its relevance and needs further study and research. The income of the population is one of the population welfare factors determining the level of their life activity. Periodicals, scientific papers, Internet sources, statistical information, scientific and methodical literature make the information base of the research. A scatter diagram of population incomes distribution in the world's countries by average annual growth rates wages and GDP per capita, correlation-regression model dependencies between average annual growth rates of GDP per capita and salary is used as one of the research methods. The economic-mathematical, calculation-constructive and correlation-regression methods were used in the study was well. Incomes of the population are the main source of satisfying their needs for consumer goods and services, and the level of population life quality is measured in quantity and quality of goods that they can purchase with their incomes. the quality of housing conditions and medical services depend on the income level. Wages make the main source of Ukrainian population income. In 2020, it made 62,3% in the total income structure of the population of Ukraine. In 2020, the nominal salary of the population amounted to 110,4% compared to the previous year, and real wages, made 107,4% taking into account the price factor. That is, the average rate of nominal wage growth is 13,4 percent ahead of the average real wages growth rates which indicates deterioration of the material situation of the population, inflationary processes in economy leading to wage depreciation and purchasing capability decline. The average salary in Ukraine in 2021 was UAH 14,577. Compared to 2020, it increased by 40% (UAH 10,340). The highest level of the average monthly salary in 2021 was in the industrial developed regions (Kyiv - UAH 21,347, Donetsk oblast - UAH 15,480, Kyiv oblast - UAH 15,152, Zaporizhzhia oblast - UAH 14,510 and Dnipropetrovsk oblast – 14,479 UAH. The lowest level is observed in the Volyn oblast (UAH 11,735), Kirovohrad oblast (UAH 11,658), Ternopil oblast (UAH 11,455) and Chernivtsi oblast (UAH 11,326). This differentiation of wages is predetermined by the specifics of these regions and the structure of their economic development. The indicator of the wages share in GDP was 46.2% in 2021 (to be compared with the average in the EU, salaries make up 50% of GDP). This is a good indicator for Ukraine, but the size of the GDP is low. In 2021, GDP of Ukraine made only 2.7% of the analogue for the USA, 12,1 – for Germany, 17,3% - for Great Britain and 41,4% for Poland that indicates the poverty of our country. Income growth during the studied period by almost exceeds the level of inflation by 27,9-31,4% and indicates an increase in well-being population. However, according to the IMF data regarding the rating of GDP volumes per capita in 2019, Ukraine ranked last among the world countries. During 2020-2021, Ukraine ranked 101st among the 199 world countries. The scatter diagram makes it possible to assume the presence of a logarithmic nature of the relation between the average annual wages growth and GDP per capita by country. Ukraine, Iceland, Estonia, Latvia, Lithuania, Hungary and Poland are among the countries with high GDP and wages growth rates. A low GDP and wages growth rate is observed in Australia, the Netherlands, Greece and Belgium. The correlation-regression model of the dependence between the average annual GDP growth rates per capita and wages confirms that the size of GDP per capita affects the average annual wages and this dependence must be high. Unfair distribution of national income in the country, tax evasion, and a high level of the shadow economy can be the reasons for the lack of a high correlation between the change in GDP per capita and wages in Ukraine. Ukraine is among the countries with the lowest average wages compared to developed countries. Therefore, Ukrainians have to go abroad in search of more acceptable conditions and wages. In addition, the part of the population that has remained living in the country is paid "under the table", they work in unfavorable conditions and are socially unprotected. Therefore, in order to improve the level of welfare of the population, the state should set the minimum wage corresponding to the level of the real living wage; to legalize the payment of wages; to provide benefits and subsidies to the poor and low-income segment of the population with examining their living standard; attract investments and innovations in production processes that will result in wage growth; reduce and simplify the level of taxation, which affects the reduction of the shadow sector of the economy; restrain the level of inflation; create conditions for the development of small and medium-sized businesses which will further create new jobs; reduce the corruption level, etc