Study: 65.1% of Armenia`s population cannot afford healthy food;  experts recommend raising  minimum wage to 100,000 drams

ArmInfo.  65.1% of Armenia's population cannot afford healthy food, as stated by Ruben Markosyan, Vice-Rector for Academic and Methodological Work at the Eurasian University, an expert in public and social policy, and  Associate Professor at Yerevan State University, on November 25

He noted that this per capita figure is approximately $4.2. "The  important issue isn't just the numbers, but the lack of productivity  and  economic development in the country, which results in average  wages, that are not sufficient for  a decent living standard.   When  we calculate the average salary using a relative method, we are again  disappointed in many cases, because we understand that it does not  provide the conditions for a decent life," the expert noted.

Recalling that the minimum wage is indexed based on the average, he  noted that the gap between them is significant. Specifically, citing  data from the Statistical Committee, the expert noted that in  July-August, the average salary in Armenia was 295,000 drams, while  the minimum wage is 75,000 drams. According to him, in many  countries, automatic indexation has been implemented-that is,  increases occur based on clearly established mechanisms and criteria  in accordance with the law.

"We are talking about institutional processes where the influence of  political decisions is minimized," he added. Armenian legislation,  however, lacks a procedure for revising the criteria or methodology  for calculating the minimum wage. The Law on the Minimum Consumer  Basket, which was adopted in 2004, is also not operational. According  to Markosyan, the Statistical Committee of Armenia publishes the  minimum consumer basket quarterly, which in 2024 amounted to 916,000  drams, exceeding the minimum annual wage. He noted that he had  approached the relevant agencies with recommendations to revise the  methodology for the structure of the minimum consumer basket, which  is outdated. Pointing out its shortcomings, the expert noted that,  for instance, the minimum consumer basket only includes apples as  fruit, and potatoes and onions as vegetables.

"If we look at the period from 2020 to 2024, the goods included in  the minimum basket increased in price by 23.2%, while the minimum  wage increased by 10.3%, meaning the minimum wage in 2024 should have  been at least 83,000 drams, not 75,000 drams," the speaker noted. In  conclusion, Markosyan emphasized that the cost of the minimum  consumer basket should ensure decent living conditions, including  necessary expenses such as transportation, utilities, healthcare, and  others.

"Government decisions are needed to ensure that minimum wage  increases are inclusive. We understand that today, neither the  average nor the minimum wage reflects people's real social needs. But  we have what we have-a country with a high poverty rate, where 65% of  the population cannot afford a healthy diet," the associate professor  said.  Summing up, he noted the need to develop an objective  methodology for calculating the minimum consumer basket, a  methodology for calculating the minimum wage, and enshrine this in  legislation. He suggested that the most appropriate approach  would  be an automatic revision mechanism for Armenia, or the government  should be required to ensure regular revisions of the minimum wage.  Specifically, during the transition period, according to the study's  recommendations, the minimum wage in Armenia should be raised to  90,000-100,000 drams-that is, until a methodology is developed that  will allow for more objective indicators.

It should be noted that the study was conducted by the  Friedrich-Ebert-Stiftung in collaboration with the Confederation of  Trade Unions of Armenia. The study was led by Ruben Marksyan, Anna  Martirosyan, and David Petrosyan.