Russia's soaring wages and Ukraine's defense production race amid war

Russia’s civilian economy is facing an unprecedented wage surge as the war effort draws workers into the defence sector. Average monthly pay for welders has risen to 267,000‑300,000 rubles (about 106‑174 million VND), three to five times the national average, while the military aims to enlist roughly 409,000 personnel this year, pulling up to 34,000 workers per month from the civilian labour pool. Unemployment is at a historic low of just over 2%, intensifying labour shortages for private firms.

Meanwhile, Ukraine is accelerating its own defence industry to reduce reliance on Western aid. The Ukrainian Ministry of Defence projects defence‑production capacity of $55 billion by 2026, a 55‑fold increase from the start of the conflict. Domestic procurement is set to rise from 46% of the weapons budget in 2024 to 82% in 2025. Drone output now exceeds eight million units per year, with 95% of UAVs purchased being locally produced, and the country is rapidly scaling up missiles, electronic warfare systems and ground‑based unmanned platforms.