russia Facing Billions in Wage Arrears and a Wave of Defaults

Wage arrears in russia rose by nearly 19% within a month. As of September 1, companies owed employees more than 2.4 billion rubles. Over the past year, the amount of unpaid wages has increased by 47.4%.

In August alone, overdue wage arrears rose by 385.3 million rubles. More than half of the arrears – 1.31 billion rubles, or 54% of the total – accumulated in 2026.

The main reason for the non-payments is a lack of funds at companies and organizations. Businesses do not have the money to pay their employees. Over the course of the year, wage arrears have nearly doubled, and in just one month, they increased by hundreds of millions of rubles.

The problems are not limited to wages. The rf central bank’s monetary policy, tailored to the war, is accompanied by an annual increase in the number of defaults in the corporate debt market. In 2024, there were 11 bond issuer defaults; in 2025 – 24; in the incomplete year of 2026 – already 33.

The war against Ukraine is draining budget resources, while the high cost of loans is making it difficult to finance businesses. Companies are accumulating debt to their employees, and the number of defaults is rising. russia’s economy is paying for the war not only through government spending. The cost is increasingly being passed on to employees, who are not being paid the wages they’ve earned, and to companies that are losing their ability to service their debts.