Survival economy: Ukrainians cut spending on basic needs
30 April 17:29
The National Bank of Ukraine has adjusted its inflation forecast for 2025, now expecting consumer prices to grow at 8.7% instead of the previously announced 8.4%.
According to the State Statistics Service, consumer prices rose by 1.5% in March, up from 0.8% in February.
In annual terms, the growth was 14.6%. Food prices are rising even faster. And, according to a survey conducted by Gradus Research, the rise in prices for goods and services is noticeable to citizens. The overwhelming majority of respondents (82%) declare an increase in spending over the past year. What Ukrainians save on the most, found out
According to a survey conducted in March, the main categories of expenses are food (85%), utilities (70%) and medicines (62%). At the same time, food expenses account for more than 80% of both 18-year-olds and people over 60. Among respondents aged 60 and over, 78% named medicines as one of their main expenses.
“The largest proportion of people for whom medicines are the main category of expenditures lives in villages – 71%, while in cities with a population of up to 50 thousand people this figure is 50%. This is obviously due to the fact that there are significantly more elderly people living in villages. In general, 94% of Ukrainians surveyed felt the rise in the price of medicines,” Gradus Research experts say.
Saving has become the norm
According to the survey, for 90% of respondents, the rise in price of food and medicines has become a serious problem that has forced them to reconsider their spending and start saving. 79% are already looking for ways to save money on clothes, household goods, recreation, and medicine. In villages, this process is most widespread – 86% of residents save money. In cities with a population of more than one million people, 72% save the least.
“The situation is particularly critical for people aged 60 and over, among whom 62% have to limit spending on food, and 66% of respondents aged 55-60 have to cut back on household goods. This indicates that the rise in the cost of medicines has not only affected the standard of living, but also forces people to abandon basic needs, which can have serious social and health consequences,” the researchers note.
By the way, only 2% of respondents are willing to spend money on entertainment. The exception is young people. It is young Ukrainians who are more likely to spend money on leisure and clothing. Amid economic challenges, Ukrainians are increasingly focused on the price of goods. 64% of respondents choose cheaper brands, while only 25% remain faithful to the usual ones. It is noteworthy that at the same time, young people are gradually demonstrating a willingness to spend more on premium products.
“We are witnessing a profound reassessment of values in all areas of life: from daily expenses to big dreams. The war has shaped a new type of Ukrainian – flexible, attentive to themselves and their loved ones, and critical in their choices,” comments Yevheniia Blyzniuk, sociologist, founder and director of Gradus Research.
The high level of stress that has been going on for more than four years has forced Ukrainians to invest more time in their health. 52% of respondents say that taking care of themselves requires more effort than before. At the same time, 39% admit to feeling emotionally burnt out.
But at the same time, after a long period of careful planning, consumers are rediscovering spontaneous purchases. In 2025, the share of those who act impulsively when shopping increased to 21%, and this figure is even higher among young people.
People and Businesses on the Brink of Survival
Unfortunately, as economic expert Yuriy Havrylechko notes, Ukrainians today have to not only save money, but simply do not have enough money to buy. After all, saving means consciously limiting yourself, and when you don’t have money, you simply have to refuse to buy clothes, food, medicine, etc.
“It gets even worse. If you don’t have enough money, there is nothing you can do. State policy and local government are aimed at destroying the economy, not developing it – through tax policy, regulations and the desire of local authorities to destroy small and medium-sized businesses in the regions,” emphasizes
[Kommersant] Yuriy Havrylechko emphasizes.
“In all major cities of Ukraine, kiosks and retail outlets are being massively eliminated, and each demolished kiosk means a job for 4-5 people is destroyed. This is done deliberately to destroy jobs. And, as the expert predicts, this will lead to an even greater outflow of people in search of work. In neighboring Poland, Ukrainians earned much more for the Polish budget than the country spent on refugees.
“It seems that the government is doing everything possible to get as many Ukrainians as possible to leave the country. After all, if at the beginning of the invasion in 2022 they simplified the taxation system and allowed businesses to survive, today they have started to tighten the screws again,” the expert notes.
Moreover, the cost of some medicines was reduced, but at the same time the prices of others were raised. And this did nothing. No one is restraining the rise in food prices. No tax breaks have been granted to either businesses or the pharmaceutical industry to curb the price increase.
“Last year, domestic producer price growth exceeded 50%, which is a record. That is, the growth rate was three times faster than inflation. Inflation is calculated for exports, imports, and domestically produced goods. Anything that exceeds the inflation rate is due exclusively to internal reasons: regulatory policy, taxes, tariffs, etc. They promised to keep tariffs at the pre-war level during martial law, but they did not keep their promise – under the pretext of needing money to rebuild what was destroyed. And if tariffs go up, prices for everything go up. And instead of using other resources for recovery, they decided to “shock” the population and business. This is the least thoughtful way that will not lead to anything good,” summarizes Yuriy Havrylechko.
It will get even worse. It is necessary to change economic policy so that the turnover of money is accelerated. Raising tariffs, increasing taxes and complicating regulatory procedures only slow down this process.
Author: Alla Dunina
