The Truth About the Average Salary in Ukraine | 2020 Edition
When people hear the number, they are shocked. Did you know what the average salary in Ukraine is? Well, if you did not, here goes:
$301 per month
Yes, it is that low. As of April 2018, the average monthly wage in Ukraine is 7828.00 UAH per month, which is a little under 301 USD.
But if that already seems like too little, consider the minimum wage, determined by the government. It’s just 3723.00 UAH—or 143 USD.
A minimum wage of $0.90 per hour at best!
But there is more to the quality of life than the average salary in Ukraine! In this article, we are looking at how people actually live and what you can expect as a foreigner!
The Average Salary In Ukraine Vs The Poverty Line
In October 2015, the World Bank updated the international poverty line to $1.90 a day (it was changed due to inflation, among other factors). It is pretty obvious that the average Ukranian lives above that. Ukraine is not a country of starvation and extreme poverty.
Let’s look at what “being poor” actually means. The UN defines absolute or extreme poverty as not having enough resources to secure basic life necessities. These basic needs include:
- Safe drinking water
- Information (newspapers, TV, computers etc.)
- Access to services (education, health, legal, social, and financial services)
The poverty line is drawn by the minimum income required to cover these needs.
In some aspects, life in Ukraine is decidedly above the poverty line. If you’ve ever been invited to dinner at a Ukrainian family, you know that food is plentiful and the water is perfectly safe (even if you’d rather have the vodka). Other basic necessities are not covered as efficiently.
For instance, a lot of people complain that the healthcare system is broken and that recovering from anything more serious than a cold would break your finances. To be fair, this is the case for many Americans, too. In the case of Ukraine, there is a lot to be desired from public hospitals. Complex procedures that you can get in the West are simply impossible in Ukraine where the relevant equipment is way too expensive for hospital budgets.
How To Live On $10 Per Day
You might remember the social media challenge of living on less than $1.90 per day. There are plenty of YouTube videos of people doing it if you’re curious. Either way, it’s not really realistic and $1.90 each day is genuinely not enough to survive in a non-developing country.
Ukraine is indeed much cheaper than any Western country.
That is a part of the reason Western travelers love it. You could travel to Ukraine on less than $30 per person per day. That would include two sit-down meals, your accommodation will be a hotel and not a hostel or a private room in an Airbnb and you’d have plenty of cash to spare for nights out.
For most Ukrainians, life is cheaper than that.
You yourself don’t spend as much as tourists who come to your area, right? It’s cheaper to rent an apartment (and many Ukrainian families don’t rent, they already have a place to themselves), it’s cheaper to cook for yourself, and just overall, life is cheaper when you know the place.
$10 per day is still a little low. You could not live a decent life in Kiev on that. In Ukrainian villages, however, it is more than doable.
In rural areas people have their homes, so no expenses for rent, they would typically grow some of their food, and whatever they buy is much cheaper, too. The cost of living goes down drastically.
The Average Salary In Ukraine Is Not Real?
But even though it is possible to live on the official average salary in Ukraine, that’s not how most people do it.
Yes, the average salary in Ukraine actually gives you no real information about the economy.
How Ukrainians Hide Their Income
I have to give major props to Olga Reznikova for first making me realize this in one of her videos. I highly recommend that you watch it.
Essentially, there are very strict government-imposed sanctions if you don’t pay your employees however much their salary is supposed to be. For smaller companies, this is an issue. They might have to make cuts one month but still be able to provide a higher salary most months.
There are different ways out of this.
One of them is through bonuses. The salary on an employee’s contract is lower than reality. They get paid the rest in the form of bonuses. If one month the company can’t afford to pay the full amount, they will not be sanctioned. Besides, paying in bonuses has some tax-saving benefits.
The illegal way is to simply pay the rest of the salary under the table. They get cash instead of an official paycheck. The business saves money on taxes and so does the employee.
Third, there are some people that are employees but are registered as private entrepreneurs. This also has some tax benefits.
Neither of these three ways of “hiding income” enters in the average salary statistic. Since those are so common, the real average salary in Ukraine is much higher than the numbers initially show. What is more, the relevant Ukrainian agencies have been suspected of tweaking the data, and so have some large companies.
Ultimately, you can’t trust the statistics you see. Though it’s true that some Ukrainians live on $300 per month, the genuine average is much higher.
Large Cities Vs Rural Areas
There are enormous regional differences in both income and the price of life. In Kiev, you can’t find a decent apartment under $400 per month. If you want it in the city centre, you’re looking at at least $600 to $800. Food and groceries are relatively cheap but going out for drinks can get pricey in larger cities.
Overall, to live a decently comfortable life in a big Ukrainian city, you would have to earn at least around $900 to 1000. Granted, some survive on less than that but that would mean sacrificing some “luxuries” – cable TV, going out to eat, frequent shopping, etc.
In the countryside, as I already mentioned, you could easily live on $300 per month or even less. The biggest expense people in small towns and villages have is fuel. Since those are not places with the perfect public transport, you have to drive most places. Families, especially, absolutely need a car to stay on top of things.
The Problem With Western Companies
You will be surprised to find that affordable Western brands are almost considered luxurious in Ukraine. Maybe not H&M but definitely Zara—though it should be noted there is an H&M now in Ukraine at the Lavina Mall in Kiev.
And now, in 2019, at River Mall (Left Bank).
Still, Western-style marketing seems to be a little too effective on Ukrainians.
You can feel a genuine struggle to afford what they have been told to want. Western brands have the novelty factor and they have the strong advertising strategies. You can see some people who spend way out of their means just to keep up with the trends.
Once again, the irony in the case is obvious.
What is considered lower quality and cheap in the West is often high-end in Ukraine.
In large cities like Kiev, there is an emerging community of local brands that seek to fill the gap between quality and price. There are now some prominent up-and-coming designers from Ukraine to look out for. The alternative fashion and thrifting community is also growing in some bigger cities. In small towns, though, it’s still all about the brands – the brand that you are wearing, the car that you drive, the phone you have, etc. Expect some Ukrainians to be genuinely impressed at seemingly normal things that you own. I once had someone compliment my really nice designer sunglasses. They were Nike (yes, Nike makes sunglasses, ok?)
The Average Salary In Ukraine: What It Can’t Show You
While looking at numbers and figures is usually a solid way to judge a country’s economy, the case of Ukraine is a bit more chaotic. If you’ve read our piece on Ukrainian banks, you know that the financial system is a bit complicated too.
Either way, I hope you came out of this article with a little less feeling of superiority. So many Western travelers go to Ukraine thinking they’re going to some third-world country. This is so not the case! Ukrainian people are pretty much like everyone else. Granted, they might have to get a little crafty with savings, but as a whole, the quality of life in Ukraine is pretty great!
As usual, if you have any thoughts or comments on that, we would love to hear from you in the comments below!
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