The war and sanctions led to large-scale changes in the Russian economy, or as the authorities called the phenomenon - "structural transformation". One of the distinctive features of this transformation was the growth of Russians' incomes and, above all, wages. In 2023 and 2024, they grew at an unprecedented pace, but this growth could not last long and began to run out this year.
Salaries in Russia in 2025
"We are managing to maintain a good pace of real wage growth," Russian President Vladimir Putin recently said. He added that the increases are not as large as last year, but they are still good: the real wage, i.e. after accounting for inflation, has increased by 4.5 percent.
Before that, however, the average growth was indeed much higher - 8.2 percent in 2023, 9.7 percent in 2024.
Why wages in Russia were growing - and why will it stop
The reason for the increases was the labor shortage. According to official data, unemployment in Russia is 2.1 percent, which means that there is virtually no free labor in the economy.
Even before the war, the Russian labor market was in a difficult situation - the population was aging, and the influx of new labor was decreasing. According to demographic forecasts, the number of citizens of working age in the coming years will remain unchanged at best. The full-scale invasion of Ukraine has exacerbated this problem.
The number of workers has also decreased noticeably due to mass emigration. According to the publication "The Bell", since the beginning of 2022, about 650,000 people have left Russia. Another half a million were mobilized in the fall of 2022. From the following year onwards, several hundred went to fight under contract every year. Additional demand for labor arose in the defense sector - due to the need to increase weapons production.
All these factors continue to operate, many enterprises continue to lack workers, but raising wages is becoming increasingly difficult. According to government forecasts, in 2025 the Russian economy will grow by only one percent. Moreover, growth will be concentrated in its military part, while the civilian sectors will either stagnate or find themselves in recession.
Against the background of the lack of growth, the financial capabilities of employers are decreasing - due to the decline in financial results, companies that report losses simply do not have the means to increase salaries.
What will happen to Russians' salaries in 2026
A survey recently conducted by the Central Bank shows that salary growth will continue to slow down. It shows that in 2025, 83 percent of companies have indexed or plan to index salaries, while next year they will be only 76 percent. Moreover, the amount of indexation will be lower. The main reasons are the decline in business activity, as well as the completion or suspension of investment projects, experts analyze.
Some salaries are already decreasing in real terms. Among the industries to which this applies are, for example, the extraction of minerals, the production of electrical equipment and the automotive industry. The reduction in the automotive industry is especially noticeable - almost seven percent in 2025 compared to 2024. The main reason is the massive transition of enterprises in the industry to a reduced working week.
There is also something else - average salaries give an idea of \u200b\u200bthe dynamics, but they poorly reflect the situation of most workers. A more accurate guide is the median salary (of which half of the workers receive less, and the other half - more), and it is decreasing, as Sberbank data shows. This means that the overall growth is provided by individual, small groups of workers, while the incomes of the rest either stagnate or decrease. The bank's information states that those with decreasing wages are one third.
And the turnaround in the labor market is just beginning. In the future, it may be accompanied by more unpleasant phenomena than the lag of wage growth behind inflation.
"We know well that as soon as talk begins about an impending crisis, the average person runs to the store to stock up on essential goods. But companies do the same when there is constant talk about a labor shortage," says the famous Russian labor market researcher Vladimir Gimpelson. "However, if the growth of real wages stops, after a certain time we may see the opposite situation: the disappearance of vacancies and the dismissal of redundant workers."
Author: Oleg Khokhlov