Were schoolteachers really paid substantially less than $45 per month in 1990s Ukraine?

Question

Shortly after Tys graduated from university and started teaching in Carbide (by Andriy Lyubka), he'd periodically borrow money from his friend Icharus:

By that time, Icarus had become a businessman (that's the title his proud neighbors and family had given him) or a smuggler (that's the title the local newspaper and police had given him), so he was flush with cash - which he'd often loan to Tys, even back in the 90s, when the economy was wretched, knowing full well that the impoverished teacher would never even be able to think about paying him back.

Later, it noted that on Icharus's first smuggling trip (on which he smuggled diesel fuel, which evidently cost "three times as much" in Hungary, as well as vodka and cigarettes),

He made 45 bucks in a single night. It'd take a couple Ukrainian schoolteachers to make that much in a month.

I'm a little confused by this, though, and why this was considered a large amount of money. Were schoolteachers really paid that little in Ukraine in the 90s? How did they live on that amount?

Answer 1

As the OP's quote says, Ukraine's economy in the 1990s was indeed "wretched":

Ukraine’s economy contracted annually between 9.7 and 22.7 percent in 1991–1996. The country experienced hyperinflation and an exceptionally huge production decline... Official GDP collapsed by almost half from 1990 to 1994, and slow decline continued throughout the decade.

(Pekka Sutela, The Underachiever: Ukraine's Economy Since 1991)

Against this background, it is not surprising that the salary of government employees like teachers was extremely low. In Problems and Prospects in European Education it is noted specifically that:

In Ukraine, in September 1994, the monthly wage of the teacher was equivalent to ten dollars.

This is corroborated by a news report from UPI from December 1994, covering a teachers' strike.

The current average salary of a Ukrainian teacher is just over 1 million karbovantz, about $10, and a big chunk of this is eaten up by taxes.

Answer 2

90s are big.

Early 1990s salaries might be below survivable, so a lot of people, even in cities and towns, had allotments or dachas. In the late 90s it would start to change. In the beginning of 90s hyperinflation would be eating your income so quickly people would not be saving money at all - and actually spending most of it right after the salary is paid.

Late 90s were a bit different as the inflation was already less brutal, but there was a big crisis in 1999 (I believe) where the currency - Hryvna - halved in a couple of months.

In Ukraine teachers were - and I believe for public schools currently are - paid by the government, so, money would come in a more predictable way, and, despite the salary size, they might be actually supporting the whole family - along with possible pensions of the parents where applicable.

My mum worked in a position paid by the government and, although my dad's salary theoretically was higher, the delays were huge - a year's salary not paid was not unique. He sometimes was paid in goods or food, so, they would be exchanging between people they knew who worked for other places and had their salaries paid in other stuff.

I don't think I thought in dollars in 90s myself, but when you needed to rent a flat, or buy a car, it would be in dollars only - which were called "conventional units" as setting price in dollars would be illegal, and 1 unit would be 1 US dollar.

In early 2000s people would already start thinking in dollars more, as real estate, electronics, cars and a lot of goods were linked to US dollars. So, my salary in 2000 would be equivalent of 50 USD initially after graduation from a Uni and grew gradually to 100 USD when I left that job in 2001. $100 allowed me to rent a flat in a city of 1.5M population, buy food and pay for public transport. Clothes were being bought in second hand shops - which, I assume now, were European donations commercialised and sold - often by weigh.

My colleague's parents bought himself a 2 room (+ tiny kitchen) flat in 2000 for $2800.

So a salary $45 per month for 2 school teachers in mid-90s sounds plausible. A good school teacher would probably be having some extra by giving private lessons, there were also possibility of working long hours in some places. Although, in other places you would be forced to work full time but have less salary as there was no budget and the job needed to be done.

Answer 3

Besides the short answer, which is "yes", here are some numbers related to the period.

The cost of 1 US dollar in Ukrainian money (karbovanets, krb.) by year:

1992	1993	1994	1995
208 krb.	4539 krb.	31 700 krb.	147 463 krb.

Sources: wiki

Avg salary, country-wide:

1992	1993	1994	1995
1523 krb.	14 204 krb.	745 523 krb.	3 208 000 krb.

Sources: government statistics Service's plot

A loaf of bread:

1992	1993	1994	1995
1.5 krb.	33 krb.	2000 krb.	15 900 krb.

Sources: government statistics Service's plot

Odessa bazaar ("privoz") prices at 11.11.1994:

• boiled sausage: 60-100 thousand krb./kilo,

• semi-smoked sausage: 180-250 thousand krb.,

• lard: 100 thousand krb./kilo

• potatoes: 25 thousand krb./kilo

• lamb: 65 thousand krb./kilo

• pork: 260 thousand krb./kilo

• turkey, whole: 100 thousand krb.

• bread "has risen in price": 15-20 thousand

Sources: "Izvestia" newspaper #217(24324)

And now about teachers.

As of 26.10.1994, First category teacher rate is 550 thousand krb. in Zaporozhye region and 850 thousand krb/month in the capital.

Sources: "Today" newspaper, 26.10.1994

As of 08.02.1995, state employees (teachers, kindergarten teachers) still have about 500-600 thousand krb. in general, but here the paper provides the the equivalent in dollars. And it's $3-4. Not 34, just 3-4.

Sources: "Today" newspaper, 08.02.1995

The paper admitted, that not only to live, but also to die with dignity was impossible for 3$. So, people were looking for another ways to "riches", like the character in your book. Yeah, the 90s period after gaining independence was a total disaster for CIS countries. And thanks for the question, it was quite a time-travel, shaking the dust off the story.

Answer 4

Well, there’s a couple things to look out for here.

1. Inflation. $45 in the 90s is probably more than you think.
2. Ukraine wasn’t very rich. Their GDP was pretty low (more inflation) so $45 wasn’t very much, but it wasn’t quite as little as you think.