Russian Wage Growth Slows as Recession Risk Grows

The labor market in Russia is entering a new phase — after several years of rapid wage growth, a period of cooling begins. According to the forecast of the Center for Macroeconomic Analysis and Short-Term Forecasting (CMASF), in the coming years, population income growth will sharply slow against the backdrop of economic stagnation.

If in 2025 real wage growth is estimated at only 3.5%, then from 2026 it will decrease to 1.2–1.7% per year. The economy, according to analysts, could enter a recession as early as the beginning of the year, and by December GDP growth will not exceed 1%.

Labor market cooling signals are also confirmed by data from the Bank of Russia. A survey by the regulator showed that most companies do not plan to raise salaries in the first quarter of the year. This contrasts markedly with the situation in recent years, when businesses were forced to actively increase payments due to a shortage of personnel.

Recruitment figures say the same. According to data from the job search and recruitment service GdeRabota.ru, which the company shared with MSK1.RU, the dynamics of salary offers have noticeably slowed. If in 2024 the average monetary offer in vacancies grew by 46.1%, then in 2025 — only by 28.2% excluding inflation. In effect, this means that a significant part of the growth is «eaten up» by price increases.

The Ministry of Economic Development forecasts that over the next two years nominal wages will increase by 7–8% annually. However, given current inflation expectations, real incomes of Russians will grow by only 1.5% or not grow at all.

Simply put, salaries will formally increase, but the purchasing power of workers will remain at the same level or even decline. For residents of large cities, including Moscow, this is particularly sensitive against the backdrop of high costs for housing, transportation, and services.

Ekaterina Agayeva, General Director of GdeRabota.ru, highlights several key consequences of the slowdown in wage growth. First is the rise in competition for qualified personnel. Salary ceases to be the main motivation tool. Companies will be forced to look for new ways to retain employees — offering flexible schedules, remote work, developed corporate culture, an expanded social package, and clear career prospects.

The second factor, according to Agayeva, is increased interest in remote and foreign work. Specialists, especially in IT, marketing, design, and analytics, will more actively consider freelancing and cooperation with foreign employers, where incomes are higher and less dependent on the domestic economic situation.

Third is the risk of growth of gray schemes. With limited opportunities for official salary increases, some employers may return to «envelope» payments to retain key employees. This increases risks for both workers and the economy itself.

«In conditions of wage stagnation, it is important for employers to focus on non-material advantages and long-term motivation of employees. And job seekers should consider that rapid income growth is unlikely in the coming years, and approach career planning more consciously,» notes Agayeva.

As can be seen, the era of easy wage gains is ending. The labor market is becoming more mature, and for both businesses and workers this means the need to adapt to the new reality.

«The decline in salaries is not just a temporary glitch, but a systemic diagnosis of the current state of the market,» says Vladimir Turman, ideological marketing strategist working with major Russian and international companies.

«We are seeing a transition to a phase where incomes no longer grow “by default.” Surveys by the Central Bank confirm: employers in the first quarter no longer include indexation in their budgets. It is important to understand: in such conditions, nominal wage growth does not mean real income growth. With inflation at 4–6%, even formally positive dynamics turn into a decline in purchasing power. In fact, we are talking about stagnation of real incomes of the population,» says Turman.

According to the expert, Russian businesses are operating in an «increased caution mode»: the high cost of borrowed funds, investment restrictions, and uncertainty force companies to focus on cost control rather than expansion. This is complemented by automation, and both factors restrain the growth of the wage fund.

According to the expert, income growth will now depend not on the general state of the market, but on the individual value of the specialist, their productivity, and affiliation with growing sectors.

«For businesses, this is a signal to reassemble strategies: increasing efficiency and investing in technologies become more important than simply inflating the wage fund. In the new conditions, only those who are able to create added value faster than costs grow will win. This applies to both entire companies and individual professionals,» says the expert.