Single-industry towns in Russia: a difficult path of development

In 2019, there were 320 single-industry towns in the Russian Federation, more than 13,5 million people lived in them, which accounted for almost 10% of the country's population. The active emergence of such settlements in Russia was often due to the development of industry in a planned economics Soviet Union. At present, single-industry towns provide about 20-40% of the GDP of the Russian Federation, while having a number of socio-economic problems that hinder their further development.

Monotowns are settlements founded at the city-forming enterprises in order to provide production with human resources. The key problem in the development of single-industry towns on the territory of the Russian Federation is their strong dependence on the economic situation at the enterprise around which the settlement was created. In addition, one should not forget that single-industry towns are often located at a considerable distance from major economic centers and transport infrastructure, which also significantly hinders their development.



Single-industry towns, whose city-forming enterprises specialize in the extraction of resources, face a particular risk. For the economy of such settlements, a serious test is the gradual depletion of the resource base, due to which the industrial component of the single-industry town functions. In this state of affairs, residents suffer the most (unemployment increases, the crime situation worsens, the level of provision of socially significant services to the population falls).

It should be noted that metallurgy is the key industrial area of ​​Russian single-industry towns, which includes not only the production of metals, but also the extraction of ore and rare metals. Enterprises of 84 single-industry towns specialize in this sector of the economy, which is more than 25% of the total number of settlements of this type. The second place is occupied by the machine-building industry, 59 enterprises of Russian single-industry towns (about 18%) are involved in it. The largest single-industry town in the Russian Federation at the moment is Togliatti with a population of 685 people.

Since 2013, all administrative responsibilities for the classification of single-industry towns have been transferred to the Ministry of Economic Development of the Russian Federation. In 2014, a government decree fixed the final characteristics that allowed the Russian settlement to have the status of a single-industry town. So, we are talking about a clearly defined city-forming enterprise, where more than 20% of the population of a single-industry town works. In addition, the number of inhabitants must necessarily exceed three thousand people. All settlements included in the generated list were divided into crisis, stable and at risk. To determine the group, the main socio-economic indicators were taken into account. For example, the unemployment rate, the situation in the industry market of the city-forming enterprise and the assessment of the state of affairs by the population. It is worth clarifying that as of 2015, the crisis group consisted of 94 single-industry towns, and the stable one - 154.

At present, single-industry municipalities existing on the territory of the Russian Federation have a number of specific problems that have emerged in connection with the peculiarities of the economic development of our country.

1. The nominal approach of domestic business to the social function. The leading structures of the majority of city-forming enterprises in Russia consider their business solely as a source of financial profit. The development of public infrastructure is considered an additional item of expenditure, which, in their opinion, should be reduced.

2. Features of the Russian interbudget policy lead to the fact that most of the tax revenues are sent to the federal budget, leaving the municipalities and regional authorities no more than 20% of the total amount of all tax revenues. At the same time, city-forming enterprises often register their legal address in Moscow, which deprives the administrations of single-industry towns of the small share of tax revenues that they could have received.

3. City-forming enterprises are provided with minimal support measures for entering international markets with their own products. The country's authorities practically do not interact with small and medium-sized businesses on the possible export of manufactured goods to other states. On their own, it is quite difficult for enterprises to resolve issues related to obtaining all the necessary certificates and understand the customs subtleties.

4. In the Russian Federation, there is insufficient funding for single-industry towns in comparison with other settlements. So, in single-industry towns, where every tenth inhabitant of the country lives, in 2006, according to economists, 537 rubles of investment per person were allocated, and on average in Russia - more than two thousand rubles.

In addition, in addition to specific problems, the development of single-industry towns is also negatively affected by the classic difficulties that are typical for settlements of this type in any country. For example, a high level of unemployment, a minimum level of innovative activity, a low level of development of the legislative framework, an insufficient level of top management at city-forming enterprises, and a low level of diversification of economic processes.

It can be concluded that each single-industry town has individual characteristics, so there is no single right solution for their development. In each case, the unique nature of the emergence of single-industry towns should be taken into account. Despite this, in the conditions of Russian reality, everything often comes down to financial subsidies from the federal authorities, which are inefficiently absorbed without bringing significant development.

Summing up all of the above, it must be emphasized that the development and support of single-industry towns is one of the key tasks of the state, which, contrary to the opinion of many representatives of the federal government, is not only about financing. It is precisely an integrated approach that should be followed, which will include legislative changes, active interaction with business, and administrative support for projects to develop social infrastructure.