Austerity measures are forcing Russian businesses to cancel entertainment events for employees ahead of the holidays. Forty-nine percent of employers said they will not hold corporate New Year’s parties this year, according to Vedomosti, citing a survey by Akcion Finance.

Most respondents attributed their decision to a lack of funds. Thirty-one percent of companies that abandoned corporate events allocated all available funds to operating expenses and priority projects. Eighteen percent switched to less expensive formats—for example, small team building events without a banquet, or limited themselves to gifts or bonuses.

Seventeen percent of companies were unable to afford a corporate event due to the crisis or staff reductions, while in 11% of cases, the cancellation was due to failure to meet financial targets. The least common reasons were a fundamental management decision, a lack of interest from employees (8% each), and organizational difficulties (7%). More than 500 financial professionals working in manufacturing, trade, transportation, and logistics participated in the survey.

No one is spending their last pennies when their budget is bursting at the seams, commented Daria Kovalchuk, leading expert at Action Finance, on the study’s results.  Another survey by the service previously  showed that businesses have stopped waiting for the economy to improve and are preparing for further spending cuts.

The cost of a New Year’s corporate party starts at 10,000 rubles per person. The average budget for a 100-person event ranges from 40,000 to 70,000 rubles per person, according to Nikolai Andreev, CEO of the Big Jack agency, in early December. Therefore, a corporate party can cost an employer 4-7 million rubles.

In some regions, authorities are calling for a ban on large-scale New Year’s celebrations. Recently, the head of Tuva, Vladislav Khovalyg, made such a request, proposing to donate the money saved to the needs of those who fought in the war with Ukraine. “Our main task is to be with them in our thoughts and actions, not in noisy celebrations. Under the current circumstances, holding large-scale New Year’s events with corporate parties and fireworks is unethical,” Khovalyg noted . He added that other regions have also introduced similar restrictions, including Stavropol, Bashkortostan, Leningrad Oblast, Krasnodar Krai, and Chuvashia.

(C)THE MOSCOW TIMES 2025