A quarter of small businesses in Russia have cut staff due to the economic crisis
More than 90% of Russian small business owners have reported a sharp deterioration in their financial situation due to soaring costs, increased tax pressure, and a decline in consumer purchasing power.
Over the past three months, more than a quarter of companies in the aggressor state have been forced to downsize their staff, and one in five businesses is officially preparing for complete closure.
The economic situation is forcing Russian entrepreneurs to resort to drastic measures to survive in the market.
More than half of those surveyed—53.5%—admitted that they were unable to offset rising production and logistics costs by raising final prices, as Russian citizens simply do not have the money.
Against this backdrop, 26% of small and medium-sized businesses have cut staff, 30.4% have switched to a strict cost-cutting mode, 8.2% have outsourced functions, and 6.2% have completely ceased operations.
Analysts note that Russian businesses are returning en masse to illegal business practices in order to minimize financial losses.
Specifically, 6.3% of respondents admitted to using gray accounting schemes, 5% stopped issuing cash register receipts, and 3.6% began artificially splitting up their businesses to evade taxes.
The future outlook for Russia’s commercial sector appears critical, as 21% of survey participants are already considering fragmentation, and 20% anticipate the complete closure of their companies in the near future.
Another 16.2% plan to raise prices by more than 20%.
Russian business is currently in a state of controlled collapse
After three years of unexpected economic growth, Russia is facing a sudden slowdown—war costs, inflation, and falling oil prices have begun to weigh on an economy that until recently seemed resilient to sanctions.
Consumer lending in Russia has fallen to a six-year low.
