War economy boosts life satisfaction for ethnic Russians and residents of military-industrial regions

Abstract

The years 2013 to 2023 constitute a lost decade for Russians in terms of their material well-being. Real disposable incomes in Russia only recovered to their 2013 level in 2023. The war years have boosted Russian real income growth driven by a steadily shrinking labor force. Wartime mobilization and emigration have exacerbated this trend, with labor shortages now widespread. While government stimulus has helped war-related industries compete for scarce talent, it has also forced companies in sectors not involved directly with the war effort to offer higher wages.