As Russia’s full-scale invasion of Ukraine approaches its fourth year, Moscow’s military recruitment policies may be backfiring. The Kremlin has turned the far-flung, resource-rich regions of the Russian Federation into both its economic engine and its human reservoir. These areas keep the Russian budget afloat through oil and gas production, yet they’re also suffering the highest per-capita battlefield losses.
That imbalance now threatens the very industries that make Putin’s war possible.
Oil and gas don’t just prop up Russia’s economy; they bankroll the Kremlin’s war machine. In 2021, oil and gas rents made up nearly half of the federal budget and roughly 20 percent of the country’s GDP. These industries are overwhelmingly concentrated in Western Siberia, the Volga-Ural basin, and other resource-heavy peripheries, areas that have never received the kind of investment that Moscow showers on major cities. They bear the brunt of the burden in sustaining the Russian economy without reciprocal development.
They are also paying a disproportionate share of the human cost. Because Russia refuses to publish casualty data, independent outlets like Mediazona have become the main source of information. Using confirmed casualty lists and Rosstat population data, the analysis shows that extractive regions experience higher death rates than non-extractive regions.
These higher casualty rates have a number of causes, from the Kremlin’s “meat grinder” battle tactics to financial incentives, which greatly appeal to those in underdeveloped regions. But the consequences are clear: the very regions that Russia relies on the most are losing men faster than anywhere else.
This would be bad enough in normal times. But Russia entered the war already facing a severe demographic and labor crisis. More than a decade ago, Russia’s statistical service created three population scenarios, dependent on various levels of migration into the country. Its most optimistic scenario required Russia to bring in 550,000 migrants every year just to keep the national population from shrinking. Even then, the size of the labor force was expected to shrink.
The war has only worsened what was once called the “biggest political, social, and economic challenge for Russia” through 2050. This spring, unemployment hit a record low of 2.2 percent, signifying a tight economy and labor shortage. In 2024, Russian job site SuperJob reported that 73 percent of the country’s businesses were understaffed.
Even Russia’s most stable and vital industries are feeling the strain; postings for oil and gas positions rose 24 percent in the first quarter of 2024 compared to the same period a year earlier. When the country’s most economically critical and traditionally resilient sectors struggle to staff operations, something is seriously wrong.
Historically, Russia has relied on Central Asian workers to fill labor shortfalls. But that lifeline is breaking down for three reasons.
First, xenophobia has exploded. Hateful or violent rhetoric increased 720 percent in 2024 alone. The topic of migrants continues to become more popular in the news and on social media, and the tone is 84 percent negative, with the most popular comments calling to “persecute,” “kill,” “beat,” and even “castrate” migrants.
Second, the government has translated this hostility into law, passing new restrictions that make it harder to enter, live, or work in the country.
Third, Central Asian economies are improving. As the quality of life and economic opportunity in those places continue to improve, fewer people need to leave them to earn a good wage.
Russia now faces a self-inflicted crisis. Moscow’s aggression in Ukraine is destroying the labor force in the very industries that make its ambitions possible. Oil and gas, the industries that fund Russia’s military and government, cannot function without people. The one group that could have buoyed the labor force has been alienated and no longer wants to come. Simply put, Russia is draining its economic future to sustain the war in Ukraine.
Eventually, the Kremlin will be forced to choose between its military campaign and its economic base. Moscow can keep sending men to die, but it cannot continue to bleed the periphery in a long war without hollowing out the regions that power its economy.