russia Importing Labor Amid the Staffing Crisis

russia’s businesses are switching to imported labor en masse. Already, 37% of companies use foreign workers, and another 43% are ready to hire them, compared to only 5% and 23% respectively in 2022. The main sources are post-soviet countries (38% of companies), China, north korea, Thailand, and Cambodia (21%), Africa, and India (13%).

A telling example is the “rzd”: despite announcing a 6% reduction in staff, the state-owned company is recruiting workers from India. The first 35 people have already been employed in the volga railway with housing and social support provided.

The reasons are obvious: the structural shortage of personnel reached 2.7 million people at the end of 2025, with a 40-50% shortage of personnel in logistics, construction, and trade. Businesses are using low-skilled migration as a way to keep costs down. For 2026, the government has increased the quota for attracting workers from visa countries to 279,000 people – a 19% increase over 2025 and the highest in decades.

In parallel, the authorities are tightening control over migrants. The state duma is considering a draft law which  would require foreigners to pay advance tax payments not only for themselves but also for their dependents. The length of a family’s stay is tied to the duration of the employment contract, migrants’ children over the age of 18 are required to leave the country within 30 days if they have no other grounds for residence. The patent will be revoked if the employee’s income is below the subsistence level or if he or she has worked less than ten months per year.

The growing dependence on foreign labor is a direct consequence of structural distortions in the labor market caused by the war against Ukraine. This model does not resolve the problems of productivity and the shortage of skilled workers, but instead reduces incentives for technological modernization of the economy.