Russia showers cash on men enlisting in Ukraine war, bringing prosperity to some towns

Expensive new cars and motorcycles crowd the streets. Apartment prices have more than doubled. And once-strapped residents are suddenly seen wearing fur coats and carrying ostentatiously overflowing grocery bags.

That is how one resident of a small, long-impoverished industrial city in Siberia describes her hometown these days. The explanation for the burst in prosperity lies in the isolated cemetery, with rows of Russian flags marking the new graves of soldiers killed in Ukraine, and also downtown, where a billboard lists the scores of local men who went to fight.

"I was stunned by how many," said the resident, the wife of a middle-aged firefighter who enlisted last summer without telling her beforehand. "Money from the war has clearly affected our city."

Russia has been showering cash on men who enlist. It wants to avoid an unpopular draft, while also addressing the lack of men with sufficient patriotic zeal to join up. There are large signing bonuses, fat monthly salaries and what Russians call "coffin money," a substantial payment to the families of the tens of thousands of soldiers killed in battle.

The money is changing the face of countless Russian backwaters such as the Siberian city. "The allure of extremely high salaries and other benefits has been a major factor in attracting voluntary recruits, especially from relatively poor regions," said a report issued this year by the Bank of Finland's Institute for Emerging Economies.

By improving the standard of living among Russia's poor, the payments have spurred support for President Vladimir Putin and the war, researchers noted, while also changing the perception of fighters from patriots to "soldiers of fortune."

The names and hometowns of the people living inside Russia who agreed to discuss these war payments are not being published to avoid possible legal problems for speaking publicly about the conflict.

Russia has stopped publishing various economic statistics, leaving only a patchwork of indicators about the effects of the war payments. Some studies have documented the influx, however.

For example, the Bank of Finland researchers found that the number of bank accounts in Russia's poorer areas surged over the past year. Nationwide data was too uneven to establish a concrete correlation with signing bonuses and enlistment data, the study said, but general estimates of casualties by region coincided with the areas experiencing high growth in bank depositors.

Also, in recent months, recruitment posters across Russia changed noticeably, replacing patriotic themes with financial offers. State TV and advertisements on social media carried the same messages.

"Pride of Russia," some ads used to say, naming the soldier pictured, or "Homeland Begins with Family," showing a soldier silhouetted with a mother and child. There were comparisons to heroic feats during The Great Patriotic War, as World War II is known in Russia.

Now, a ruble sign dominates the posters, which display the large sums on offer for signing a military contract. Payments vary by region.

"The people who wanted to join out of patriotic sentiment have mostly already been recruited and died or were wounded," said Oleg Jouravlev, one of the founders of PS Lab, a group of mainly sociologists organized under the Russia Program at George Washington University to study attitudes toward the war. "There are not many like that left in Russia."

On July 31, Putin issued a decree more than doubling the contract signing bonus from the federal government to 400,000 rubles (more than $4,000) from 195,000 rubles. At least 47 regional governments followed suit after he encouraged them to match the reward, according to a survey by independent media outlet iStories, with the average signing bonus nationwide quadrupling in the past eight months.

U.S. officials estimate that Russia is recruiting 25,000 to 30,000 new soldiers a month, roughly equal to the number of dead and wounded. As soon as local governments see interest lagging, they jack up the financial incentives, experts say.

This past month, the frontline Belgorod region broke all records with a signing bonus amounting to more than $30,000, well above the previous leader, Moscow, at about $20,000. The lowest bonuses are about $500.

The larger sums constitute a small fortune in many of the less-developed towns and villages of Russia -- where the average salary is a few hundred dollars per month -- especially when combined with a front-line fighter's monthly salary starting at 210,000 rubles (about $2,100).

A study of the payments for Re: Russia, an online platform for political and economic analysis, found that the signing bonus equals roughly the average annual per capita income in Russia, and the monthly salary is three times the average wage. Rural wages are significantly lower than those in big cities.

"The money is a social elevator for those who went to war," said Ayan, a resident of Buryatia, a Siberian region with a considerable proportion of people living below the poverty line and high levels of personal debt.

Coffin-money payments amount to almost $150,000 per family, enough to buy an apartment in all but the most expensive Russian cities. Although an apartment is often the main goal, recipients say they buy all kinds of things, including new teeth, breast implants and vacations.

The war payments are especially attractive to impoverished, middle-aged men who see them as their last chance to escape a lifetime of debt, said Ivan Grek, director of the Russian Program at George Washington University. Beyond that, people getting the money are eating in restaurants, and buying cars, electronics, clothes and property.

Government statistics from early 2024 show a 74% growth in ordinary Russians across the country purchasing cars compared with the same time period last year, Grek noted, while those paying off consumer debts jumped to 21%, up from about 9% before the war.

"There is the spirit of a party out there," he said, even if the source of the money limits the euphoria. His program recently sent three researchers to live for a month in small Russian communities to gauge perceptions of the war. "Now they have a car, they can drink and eat, it is a whole new life for them," he said.

Artem, a soldier who fled Russia, estimated that 60 per cent of the men in his unit signed up because they had unpaid loans. "Almost all of them had problems with alcohol and debt," he said.

Some experts question whether the spiraling payouts are sustainable and expect that the draw, like patriotism, will eventually fade. Overall, war payments to Russian soldiers -- whether for signing, injury or death -- will amount to at least 7.5 per cent of federal spending for the year, according to Re: Russia.

The sister of a dead officer from Makhachkala said that although he was alive, he kept telling her that the death payment would take care of her, their mother and his daughter: "'Buy an apartment,' he said, and I told him, 'You are a moron! Don't even say such things.'"

Despite the shattering grief after his death, the sister said, the money makes it feel as if her brother is watching over them posthumously. "He did everything he wanted for us," she said.

The money often has a trickle-down effect. A resident of North Ossetia said that a couple of years ago, his local plumber had applied to emigrate due to the lack of work. But recently, he said, the plumber told him, "I've never had so much work in my life," with war widows buying new apartments or refurbishing old ones.

The firefighter from Siberia, 46, had gone heavily into debt over failed foreign exchange trades, according to his son. After losing several fingers in an industrial accident, he had burned through a $25,000 settlement and a considerable chunk of his disability pension. The father sold the family car to raise money, but ultimately the man filed for bankruptcy before enlisting.

A few days after the first interview for this article, the firefighter's wife, who had not heard from him in a month, received a military report saying that he had been shot in the chest and killed July 30, just four days after he deployed in Ukraine. Two younger soldiers trying to rescue him also died, but no bodies have been recovered.

"You are signing your death warrant," his son said of his father's decision to enlist. "It was a foolish decision to abandon my mother and my sister and cause everyone so much pain. Money is irrelevant in this situation."