Wage debts among Russian firms escalated sharply in early 2025, indicating heightened financial strains on businesses in several vital sectors, as reported by the General Confederation of Trade Unions and published in the pro-Kremlin newspaper Izvestia.
Official figures from the government show that wage arrears jumped from 500 million rubles ($6 million) in January to 1.5 billion rubles ($18 million) by March. However, the trade union’s analysis suggests the true total could be significantly higher, estimating it at 2.4 billion rubles ($30 million) for the first quarter alone.
The most substantial debt was reported at DSK, a road construction firm located in the Tver region, which owed 608 million rubles ($8 million) to 3,657 employees as of the end of March.
Other significant examples included Shakhta Inskaya, an industrial equipment provider in the Kemerovo region, which was late in paying 65 million rubles ($800,000) to its workforce. Additionally, Rassvet, a catering company based in the Tula region, was behind on payments by 36 million rubles ($450,000).
Dmitry Pishchalnikov, vice president of Opora Russia—an organization representing small and medium enterprises—told Izvestia that “the highest levels of wage arrears were observed in sectors such as construction, manufacturing, and water supply and waste management.” He also highlighted that businesses in the Ural Mountains and Siberian territories are facing particularly severe challenges.
“These industrial regions host a multitude of companies relying heavily on borrowed capital and government contracts, which makes them particularly susceptible to the current stringent financial environment,” Pishchalnikov remarked, pointing to the Central Bank’s key interest rate of 20%.
Furthermore, he referenced data from the Federal Labour Inspectorate revealing that over 18,000 complaints regarding wage delays were registered in 2024, a 37% increase compared to 2023. “The majority of these complaints originate from employees of small and medium-sized enterprises, particularly those engaged with government contracts or serving local markets,” he added.
Independent economist Andrei Barkhota characterized the situation as an “existential dilemma” for many businesses, cautioning that elevated interest rates could raise monthly debt payments by 30% to 70%. “Under this pressure, firms are left with the stark choice of either postponing wages or defaulting on loans. Since defaulting could jeopardize their funding and adversely affect their credit scores, many are increasingly opting to delay wage disbursements,” he explained.
The Labor and Employment Service confirmed receipt of monitoring data from the Trade Union Confederation, which identified organizations with a combined wage debt nearing 2.4 billion rubles ($30 million). The agency added that its findings were supported by the State Labor Inspectorate and analyses of primary corporate documents.
