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Russia's tale of two cities: How war deepened regional divides

The war has reshaped everyday life in Russia. Prices have surged, wages have grown, and contract soldiers on the front are earning sums the regions had never seen before. Yet the divide between the country’s most developed regions and its poorest is only expanding. Comparing life across Russia is also becoming harder, as official statistics are increasingly hidden from public view. The Insider has sifted through what data remains available and found stark imbalances in economic growth, quality of life, and household prosperity. Regional inequality has already become a key factor driving economic and social tensions.

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How to tell which regions are rich and which are poor

There is no single way to measure a region’s wealth. Rankings compare everything from wages and living standards to education levels and consumer demand, but they use different methods and criteria when doing so. A region might lead the country in wage growth but lag far behind in quality of life or social well-being.

Take the social well-being index. It puts Moscow, the Yamalo-Nenets Autonomous District, Magadan Region, and the Khanty-Mansi Autonomous District at the top of its list for wage and income growth when adjusted for living costs. But in terms of consumer demand growth, the leader is nowhere to be found — that would be the Republic of Adygea, where demand jumped by 20.7%. Moscow didn’t even make the top five.

The Nenets Autonomous District ranks high in social well-being and in wage level (among more rural areas). But in 2024, consumer demand there rose by less than 1% — a sharp contrast to the region’s relatively high incomes. There are several reasons why. Income growth often benefits only narrow groups, like government employees or staff at big companies, while many others earn little and face financial strain. The exodus of international brands has also dampened demand: some goods have become scarce, and those brought in via parallel imports now cost more. In addition, incomes have grown faster than industrial output, so the economy simply can’t keep up with demand. And then there’s the mood of uncertainty — people expect high inflation, so they save rather than spend. Often though, it is the relatively well-off who are holding back, while the poor have no choice but to spend nearly everything they earn on food.

The Chukotka Autonomous District and Magadan Region also stand out for high provincial wages and strong business payment discipline. But when it comes to quality of life, they come in much lower in the rankings, weighed down by social and infrastructure problems.

To really understand how people live in different parts of Russia, one has to look at a mix of factors — not just the economic ones.

Where the human toll is greatest

In the three years of war, Russia’s population has shrunk by 860,000, which works out to an average annual decline of about 287,000 people. Still, in 2020, the country saw its largest drop in modern history — by more than 1 million people — driven largely by the COVID-19 pandemic, which claimed at least 160,000 lives in Russia that year.

At the start of the 21st century, Russia’s population was falling. But from 2008 to 2020, the number grew by nearly five million (from 142.7 million to 147.46 million, with the annexation of Crimea contributing 2 million to the total.) This growth more than made up for earlier declines, and over the two decades from 2000 to 2020, Russia’s population increased by a total of about 1.15 million. In just three years of full-scale war, the country has lost nearly as many people as it gained in the previous twenty.

In the period 2021-2025, the population declined in most regions, The Insider calculated based on Rosstat data. The losses were steepest in border areas — Belgorod Region (-54,000 people), Bryansk Region (-32,000), Kursk Region (-28,000), Rostov Region (-55,000), as well as in annexed Crimea (-29,000). Numbers also fell in several national republics: Mordovia (-22,000), Buryatia (-7,000), Bashkortostan (-49,000), and Udmurtia (-22,000). Depressed industrial regions were hit too, such as Kemerovo Region (-65,000) and Irkutsk Region (-41,000). But in the country’s biggest urban centers, the trend was reversed: Moscow added 260,000 residents, and the Moscow Region gained 233,000.

Population decline is not always the result of deaths on the battlefield — it can also stem from emigration, internal migration, or natural decrease. According to the Haron project, the highest numbers of confirmed war dead come from Bashkortostan (over 3,000), Krasnodar Region and the Republic of Tatarstan (2,700 each), Sverdlovsk Region (2,500), Perm Territory (2,200), Chelyabinsk Region (2,100), and Moscow (2,000). The smallest numbers were recorded in the Nenets Autonomous District (64), the Jewish Autonomous Region (84), and Chukotka (93).

A large-scale population drop has knock-on effects for living standards and the broader economy: labor shortages emerge, consumer demand falls, and economic growth slows, while the pressure on social services and the pension system increases.

Where the pay is higher

Regions are competing for workers, and the key factor in their decision is how much employers are willing to offer. Average wages nationwide have risen sharply during the three years of war, but the regional gap has not closed — in fact, it has grown.

In 2021, only nine regions had an average monthly salary above 100,000 rubles ($1,370 at the time). By 2024, according to the latest figures, there were eleven (now $1,254). In 2021, about half the population of Chukotka and the Yamalo-Nenets Autonomous District earned more than 100,000 rubles, as did one-third in Magadan Region and the Nenets Autonomous District. For comparison, only one in five workers in Moscow did.

In most regions, average wages in 2021 ranged from 22,000 to 54,000 rubles ($297-$740) a month. In the lowest-paying areas — the Chechen Republic, Ivanovo Region, and the republics of Ingushetia, Dagestan, Mordovia, and Kalmykia — roughly one in five people earned less than 15,000 rubles ($206) a month. By 2024, average salaries ranged from 35,000 to 88,000 rubles ($439-$1,103).

The top ten regions for wages over the three years of war have barely changed, still dominated by areas with extractive industries and northern autonomous regions. In the Chukotka Autonomous District, the average salary jumped from 130,000 rubles in 2021 ($1,781) to 185,000 in 2024 ($2,320). The Yamalo-Nenets Autonomous District saw an increase from 130,000 ($1,781) to 164,000 rubles ($2,056), while in Moscow the figure rose from 120,000 ($1,644) to 162,000 rubles ($2,031).

The lowest-paying regions have also remained much the same: North Ossetia–Alania, Kabardino-Balkaria, Dagestan, Kalmykia, Chechnya, and Ingushetia, where about half the population still earns under 30,000 rubles a month.

At the same time, the gap between regions with the highest and lowest average wages has widened. In 2021, the highest average wage was in the Chukotka Autonomous District — 130,561 rubles ($1,788) — while the lowest was in Chechnya — 31,272 rubles ($428). By 2024, residents of Chukotka — still the undisputed leader — were earning an average of 184,970 rubles ($2,319), while in Ingushetia, which ranked last, the figure was just 39,964 rubles ($501). In some southern and northern regions, where wages were already much lower, increases lagged behind those in places like Moscow, where pay jumped 45.9%. Some areas saw wages grow even faster, but that didn’t lift them to competitive levels due to the fact that they had started from such a low base.

There are also sharp divides within regions themselves. In 2021, the biggest gap was in Ingushetia, where residents of small towns earned barely half as much as those in larger population centers. A gap favoring smaller towns was seen in only three regions – the Nenets Autonomous District, the Komi Republic, and Amur Region. Leningrad Region was the only one where pay in small and large towns matched — everywhere else, cities outpaid the countryside.

By 2025, the map had shifted, and the region with the widest divide was now the Chechen Republic — with a difference of 64.9%.

Winners and losers

One way to gauge the economic performance of a region is by looking at per capita growth in gross regional product (GRP). Nationwide, excluding inflation, this figure rose by 29% from 2021 to 2023 (the most recent year calculated by Rosstat). And in some regions, the gains were far greater.

The leaders were Kalmykia (up 64%), Chuvashia (53%), Khanty-Mansi Autonomous District–Yugra (48%), Amur Region (48%), Altai Republic (45%), Krasnodar Territory (45%), and Ivanovo Region (44%). Most of these have enterprises in the defense industry, which have benefited not only from state defense contracts but also from government-subsidized loans — or even advance payments that allow them to bypass the need for bank financing altogether.

In Chuvashia, the defense industry now employs about 30 enterprises — five times more than before 2022. In some regions, advance payment mechanisms for companies fulfilling state defense orders have been enshrined into law. In others, growth has been driven by oil and gas extraction or by the expansion of local industries, often spurred by import substitution policies.

But the gap between regions in their share of the country’s total gross regional product (GRP) has widened, with the indicator falling in regions including the Yamalo-Nenets Autonomous District, Murmansk Region, and the Republic of Karelia. This points to a concentration of economic activity and resources in a limited number of regions, which in turn fuels inequality and widens development gaps across Russia.

Even more than overall economic growth, people care about their incomes. However, the average income is not always the best measure. If wage inequality is high, a handful of the very rich can distort the picture. A better metric is median per capita income. According to Rosstat data for 2024, the absolute leader here is Chukotka, with a median income of 117,000 rubles ($1,467), followed by the Yamalo-Nenets Autonomous District at 104,000 rubles ($1,304) and Moscow at 100,000 ($1,254).

The sharpest income growth during the war was recorded in Oryol Region (up 75%) and Kabardino-Balkaria (up 71%). Median incomes jumped by more than 60% in Smolensk, Vladimir, Kurgan, Irkutsk, Kemerovo, and Novosibirsk regions, as well as in Kalmykia, Udmurtia, Chuvashia, the Altai Republic, Krasnoyarsk Territory, Zabaykalsky Territory, and the Jewish Autonomous Region. This again reflects the wage race at defense industry plants, as well as contract payments, death gratuities, and other compensations to soldiers and their families.

The slowest increase in median incomes over the war years was seen in several oil-producing regions: the Yamalo-Nenets Autonomous District (42%), Khanty-Mansi Autonomous District–Yugra (42%), and Tyumen Region (43.2%). In annexed Sevastopol, incomes grew by 43.9%, while in the Republic of Ingushetia they rose by 45.8%. However, the slower growth in some wealthier regions and faster growth in certain poorer ones did not change the overall trend toward a widening gap between rich and poor.

Purchasing powerlessness

The nominal growth in wages failed to keep pace with rising prices, leaving people’s purchasing power stagnant or reduced in a number of regions. In the Republic of Kalmykia, for example, the index fell from 1.33 to 1.28. Similar declines were observed in Dagestan, Tuva, Kabardino-Balkaria, Karachay-Cherkessia, Mari El, North Ossetia, and Chechnya. The drop ranged from 0.03 to 0.08 points, meaning people’s purchasing power in these regions decreased (data for 2021and 2025, respectively).

The gap in purchasing power between prosperous regions and the those left behind economically has become even more pronounced. In 2021, the Yamalo-Nenets Autonomous District ranked first with an index of 4.88, while Kalmykia was last with 1.33. By 2025, Yamal improved its score to 5.55, while Kalmykia’s fell to 1.28.

Who drinks the most

According to Rosstat, before 2021 retail alcohol sales in Russia were growing at no more than 4% annually. But by 2022, that figure had reached 8.2%. Since then though, Health Ministry estimates show a slight decline in per capita alcohol consumption: in 2024, the average resident consumed 8.4 liters, compared with 8.5 liters in 2023 and 8.6 liters in 2022. By region, drinkers in northern and Far Eastern territories tend to consume more alcohol than those elsewhere.

The most sober regions are the republics of the North Caucasus: Chechnya (0.14 liters), Ingushetia (0.25 liters), Dagestan (0.98 liters), Kabardino-Balkaria (1.04 liters), and Karachay-Cherkessia (1.5 liters).

The direction of consumption trends vary by region: in Karelia, Komi, and Murmansk Region, consumption rose by more than a liter, while in Moscow Region and Magadan Region, it declined. Despite overall growth in alcohol consumption, the regional pattern has remained stable: the north and the Far East are leaders, and the North Caucasus remains at the bottom. As with the increase in income inequality, over the past three years the gap between regional alcohol consumption has only widened.

Where there's more danger

Despite an overall 4.6% decline in crime from 2021 to 2024, the number of serious crimes increased by 10.2%, and the share of such offenses rose from 27.9% to 32.3%.

The highest number of serious crimes are recorded in Moscow, Moscow Region, Sverdlovsk Region, and Krasnodar Territory, while the steepest relative increases were seen in Dagestan (up 28.2%, from 3,209 to 4,112), Tuva (up 26.7%, from 1,180 to 1,495), and Tatarstan (up 14.1%, from 7,809 to 8,912). Crime decreased in Magadan Region, Chukotka, and the Nenets Autonomous District.

Some regions have seen worsening figures across all registered crimes. In Moscow Region, the number of crimes grew by 4.3% during the war years (from 97,045 to 101,203), in Krasnodar Territory – by 5.8% (from 49,283 to 52,117), in Sverdlovsk Region – by 7.6% (from 51,142 to 55,006), in Tatarstan – by 9.1% (from 28,241 to 30,798), and in Dagestan– by 13.8% (from 15,190 to 17,282).

There has been a sharp rise in crimes charged under terrorism and extremism statutes. This may also include people prosecuted simply for their political views. The number convicted of terrorism offenses rose by 73.9% (from 2,136 to 3,714), while convictions for extremism grew by 62.7% (from 1,057 to 1,719).

Drug-related crimes also increased — by 10.2% nationwide (from 179,700 to 198,000). In Sverdlovsk Region, such crimes rose by 19.9% (from 7,340 to 8,801), and in Krasnodar Territory, the increase was 15.5% (from 5,617 to 6,491).

No winners

Examining the dynamics across all the parameters analyzed by The Insider, there have been clear winners during the war. The only potential beneficiary is Chuvashia, which ranks near the top in two areas: economic development, reflected in its rising share of the national GRP, and wage growth. Yet even this was insufficient to bring salaries up to the national average.

The situation among lagging regions is equally complex — each struggles in its own way, and there is no single obvious loser. In the Khanty-Mansi Autonomous District, for example, the GRP share grew significantly, but median income growth lagged behind other regions, as wages were already high. A similar situation exists in the Yamalo-Nenets Autonomous District: salaries were already well above average in 2021, meaning the region cannot be considered a major beneficiary of the war. Karelia fares worst in terms of GRP share, which declined even as wages and median incomes increased over the three years of conflict. In Kemerovo Region, population outflow was the highest and GRP growth minimal — only 5.3% — yet wealth and median income still rose, according to official data.

In any case, the three years of war have widened the gap between prosperous and struggling regions, reinforcing systemic problems. Nominal growth in wages and GRP in certain areas — primarily those tied to the defense industry — masks growing socio-economic inequality. Income disparities remain substantial: average wages in leading regions far exceed those in less developed areas, and income growth in wealthier regions often outpaces that in struggling regions.

Economic challenges — unemployment, poverty, inequality, and instability — contribute to higher alcohol consumption and crime. These trends are already raising concerns: for instance, Russians are increasingly aware of inequality, noticing differences in living standards among social groups and across regions. They also expect the such gaps to widen further.

Addressing disparities in geography, resource potential, infrastructure, and investment activity would require measures that require both funding and political will to implement. As long as the war continues, it is unlikely the government will find the necessary resources to reverse these socio-economic trends.