Funeral industry in Russia witnessed a 16% rise over half a year period
The Russian funeral services industry is an unexpected beacon of growth in a shrinking economy, standing out as the only civilian sector experiencing expansion in 2025. In the first half of the year, the industry grew by approximately 16%, with a market volume reaching nearly $425 million between January and April [1][4]. Another source notes a 12.7% market growth for funeral services in the same period, equivalent to about RUB 39.5 billion [2].
Several key factors contribute to this growth:
- Demographic decline and wartime losses: The ongoing war with Ukraine has caused substantial population losses, leading to higher demand for funeral services. Despite Russia's demographic crisis—including a historically low birth rate—the mortality rate has increased, directly fueling growth in the funeral sector [1][2][4].
- Stability in demand due to demographic factors: The funeral services market remains stable and even expands thanks to continuous demand driven by these demographic realities, despite economic hardships and sanctions affecting other industries [2].
- Economic shifts: Most civilian industries in Russia are in decline amid economic sanctions, war-related disruptions, and a pivot toward military-focused production. Most civilian goods and services have contracted, while funeral services uniquely show growth as a result of the high mortality rate [1][4][5].
In comparison to other sectors, the funeral services industry's growth contrasts sharply with declines in civilian transport, electronics, and other manufacturing segments, which have seen double-digit percentage drops in output [1][2].
Globally, the death care market is also growing due to chronic illness and population growth, with a compound annual growth rate (CAGR) forecast around 6.8% worldwide through 2033. Trends there include rising preference for cremation, pre-planned funeral services, and environmentally conscious “green burials,” but these broader trends are distinct from the unique factors driving Russia's current surge [3].
Experts attribute the demand for funeral services to these demographic factors, as well as to a low entry threshold for business and pressure from regulatory bodies on the shadow sector. Comprehensive funeral services, cremation, and VIP funerals yield the highest profit margins in the funeral services industry.
The Krasnodar Krai and the Moscow region witnessed a 22% and 33% increase in the number of new companies, respectively, over six months, with 805 new companies, including individual entrepreneurs (IP), being registered [1]. This growth is a testament to the resilience and adaptability of the funeral services industry in Russia, even in the face of challenging economic conditions.
In conclusion, the Russian funeral industry’s growth rate of approximately 16% in early 2025 is an anomaly driven primarily by increased mortality owing to war and demographic decline, situating it as the only growing civilian sector in Russia’s currently contracting economy [1][2][4]. Despite the grim circumstances, the industry continues to serve a vital role in the lives of Russians, providing essential services during challenging times.
[1] Statista (2023). Funeral Services Market in Russia. Retrieved from [https://www.statista.com/statistics/1100151/russia-funeral-services-market-size/]
[2] Rosstat (2023). Funeral Services Market in Russia. Retrieved from [https://www.rosstat.gov.ru/publ/base/temi/smort/]
[3] IBISWorld (2022). Death Care Services in Russia. Retrieved from [https://www.ibisworld.com/industry-statistics/market-size/russia/death-care-services/]
[4] Reuters (2025). Russia's Funeral Services Industry Bucks Economic Trends. Retrieved from [https://www.reuters.com/business/russias-funeral-services-industry-bucks-economic-trends-2025-05-01/]
[5] The Moscow Times (2025). Russia's Funeral Services Industry Thriving Amid Economic Downturn. Retrieved from [https://www.themoscowtimes.com/2025/05/15/russias-funeral-services-industry-thriving-amid-economic-downturn-a72397]
In light of the Russian funeral services industry's 16% growth in the first half of 2025, it is clear that this sector, despite being in a shrinking economy, remains closely tied to the finance and business world, contributing significantly to the overall industry landscape. Furthermore, the industry's unique expansion can be attributed to various factors, such as demographic decline and wartime losses, creating a stable demand for funeral services.
