Government Raises Minimum Wage By $6, Opposition Calls Such Rise "mo

GOVERNMENT RAISES MINIMUM WAGE BY $6, OPPOSITION CALLS SUCH RISE “MOCKERY”
By Naira Hayrumyan

ArmeniaNow
26.10.12

The Armenian parliament on Thursday passed in the first reading a
bill amending the law “On the minimum monthly salary.”

Under the new legislation, from January 1, 2013 the minimum wage will
be 35,000 drams (about $86) per month instead of the current 32,500
drams (a rise by about $6).

Only 65 members of the 131-seat body (all representing the two
coalition parties) voted for the legislation, with seven voting against
it and 25 members abstaining. Almost all factions of the parliament
said that a rise by 2,500 drams will not change anything in the wallets
of citizens, even though Minister of Finance Vache Gabrielyan said
that this money still would count in people’s “consumer basket”.

Opposition Heritage faction leader Ruben Hakobyan said that even with
this increase the minimum wage would still be nearly half as much
as the subsistence wage without inflation pressures considered. Head
of the opposition Armenian National Congress’s faction in parliament
Levon Zurabyan said that they’d vote against the bill: “Our faction
presented a bill to raise the salary to 72,500 (about $180). The bill
proposed by the government is a mockery of the people.”

Secretary of the Heritage faction Zaruhi Postanjyan also said that
such a raise was “humiliating”. “Our citizens have pride. The minimum
wage should be at least 60,000 drams (about $148),” she said.

Armenian Revolutionary Federation MP Artsvik Minasyan reminded that
his faction had suggested determining the minimum wage in accordance
with the law on the state budget, linking its size to inflation, the
minimum consumer basket and the average wage. However, the government
and the parliament rejected the proposal.

Head of the ruling Republican Party’s parliamentary faction Galust
Sahakyan said that “you can’t, of course, live off 35,000 drams” and
that it would be better if the salary was different. “If our opponents
vote against it, they’d vote for the salary to remain at the current
level, if they vote for it, this is something intolerable for the
opposition,” he said. He, at the same time, noted that if the ruling
party gives in and accepts the opposition’s proposal to double the
minimum wage, it will also have to bear the responsibility for that.

The average monthly salary in Armenia estimated for August 2012 was
121,065 drams (about $295), which was 4.1 percent lower than in July.

Wages in August 2012 as compared to August 2011 increased by 6.6
percent.

However, low wages apparently become an obstacle to economic
development. Prime Minister Tigran Sargsyan said during a government
meeting on Thursday that Armenia has encountered “structural
unemployment”.

“The sphere of information technologies sets this problem to us… It
turns out that activities in the sphere are imperiled because of a
shortage of specialists. The industry is growing by 15-20 percent a
year, the number of enterprises has reached 300, and we still have
few specialists,” said Sargsyan.

“They can’t find workers even for 5,000-7,000 drams (about $12-17)
a day. There is a shortage of workforce in the chemical industry,
in town halls,” said the head of the Armenian government.

Mayor of Yerevan Taron Margaryan also said that the transport company
at the City Hall as well as the gardening and sanitation department
at the municipality also need at least 300 employees. The average
salary in such jobs, as Margaryan said, is 80,000 drams (about $200).

Prime Minister Sargsyan instructed the economy minister to conduct
an analysis and make job cuts increasing productivity and wages.

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