by Anastasiia Polner
What associations do you have when you hear the name – Slavutych? Slavutych is a city in Kyiv oblast, Ukraine, the population of which is 24 500 people – this information pops up in the first lines of the Wikipedia article. Nevertheless, the important facts are different. Slavutych is situated only 50 kilometers away from the ill-fated Chernobyl Nuclear Power Station (CNPS), where the disastrous catastrophe happened in 1986 due to the nuclear fallout. It is the youngest city in Ukraine and was constructed to host the survivors of the accident who were evacuated from Prypiat. 26 years ago Pripiat used to be home for thousands of Chernobyl personnel and their families; nowadays it is a ghost city, totally abandoned.
Chernobyl nuclear disaster is considered to be the most horrible in the history of Nuclear Power. Before the accident Chernobyl was producing 10% of Ukraine’s electricity. Today Prypiat and Chernobyl factory are surrounded by 30 kilometers of Chernobyl Exclusion Zone. Even now there are some places on that territory that are dangerous for live beings due to high level of radiation.
Yet, some people still work on the factory to maintain, monitor it for safety reasons and work upon scientific researches. More than half of Chernobyl employees are actually construction workers, building the Shelter, known as ‘Sarcophagus’ that covers the 4th reactor, where the explosion happened. All those people live in Slavutych. Today, out of its 24 500 citizens around 3 800 work in Chernobyl, even after the remaining processes in the nuclear units were finally stopped and the whole factory was officially shut down in 2000. Before the final shutdown half of the grown up population of Slavutych, or around 9 000 people, worked on the plant. Since the shutdown the city started to find itself in crisis; around 1 500 people already left it looking for better life in other regions of Ukraine.
Let’s look at the situation from the perspective of Spacial Equilibrium model. It analyzes the migration of working force by looking at the dependence between salaries, cost of living, comfort of living (so-called “amenities”) and personal preferences. For example, the model claims that shocks in demand or supply of the labour force and the corresponding changes in wages will be partially absorbed by changing housing prices. Accordingly, local demand for housing can be derived from other factors of the model.
As the counterparts of Slavutych we take two neighbouring regions – Kyiv and Chernihiv oblasts (without the capital city itself), because they are the main areas for people’s migration from Slavutych.
The numbers tell us an interesting story. The average salary in Slavutych is 475 Euro (and almost 700 Euro for those who work at Chernobyl Station) – much higher than the country average value of 300 Euro. The region average salary is also lower at 280 Euro. With such difference in levels of income we might expect higher housing prices in Slavutych compared to neighbouring regions. However this is not the case. With a price of some 500 Euro per square meter Slavutych lags behind its neighbours by some 200-300 Euro.
One reason for that is historical: Slavutych was built in emergency and all people who moved to it, naturally got their apartments for free.
Another explanation comes directly from the Spatial Equilibrium model. On the one hand, according to different researches, Slavutych has some good-quality amenities. For example, the city consistently holds its place among the top-20 wealthiest Ukrainian cities and the top-20 most comfortable Ukrainian cities according to Focus magazine. It scores high in terms of budget spending per capita, number of supermarkets, green areas and sport venues. On the other hand, however, the preferences for living in Slavutych are really weak - virtually non-existent. That is because of poor ecological situation and the constant health risk that the workers are exposed to. As a result and not contradicting the model, average salary in Slavutych is high, whereas housing prices are low relative to average wage and housing prices in the neighbouring regions. Stated differently, it means that workers are willing to move to Slavutych if, and only if, the salaries rise without the corresponding growth in the cost of living.
We can confirm our conclusions by looking at the situation in dynamics. After the shutdown of the plant in 2000 people started to flee from Slavutych, lowering demand for accommodation, putting additional downward pressure on housing prices and confirming our proposition about very weak location preferences.
The future of Slavutych looks obscure. The city has a weak level of business activity, it creates not enough of new jobs annually, and has a deteriorating infrastructure. Finally, the Chernobyl station inevitably will be closed, sooner or later. So, if the city survives in such circumstances, it will happen because of long-term forward-looking policy of reforms and diversification. Slavutych will cease to be a unique place on the region’s map; on the contrary, it should integrate into local business chains and processes. To conclude with, the factor of utmost importance that should be taken into account is the weak preference of people to live near the radiation zone.