UNEMPLOYMENT FALLS, WAGES RISE IN ARMENIA DURING Q1
by Venla Sipila
Global Insight
April 23, 2008
There were at a total of 74,700 unemployed in Armenia in the first
quarter of this year, ARKA News reports, quoting data from the
country’s National Statistical Service. This result marks a fall
of 12.7% compared with the first quarter of 2007. In addition,
official data for the period show that the average nominal monthly
wage reached around 86,500 dram (some $280US), surging by 25.5%
in annual comparison. Development of compensation in the private
and public sectors of the economy are diverse. Indeed, wages in
publicly financed organisations averaged 60,600 dram, rising by 17.6%
year-on-year (y/y), while private sector wages gained 27.4% y/y and
reached an average of 109,200 dram.
Significance:The newest labour market data indicate further
strengthening. The Armenian unemployment rate at the end of last year
stood at 6.7%, falling from the year-ago result of 7.2%, while a total
of 75,000 unemployed were registered as jobseekers as 2007 drew to a
close (see Armenia: 18 January 2008: ). The now reported annual rise
in wages over the first quarter exceeds the growth rate for 2007 as
a whole (see Armenia: 28 February 2008: ). The rise in real wages in
early 2008, however, is likely to have been clearly more modest due to
rapid inflation. The falling trend in unemployment and growth of wages
are likely to continue, but these developments going forward are likely
to take place at a more moderate pace than recently, as growth of the
booming economy is finally expected to cool somewhat. However, figures
on the officially registered unemployed need to be interpreted with
caution, as the proportion of the unemployed registering as jobseekers
is still low, mainly because the very modest level of unemployment
benefits only provides weak incentives to register. The beginning
of 2006 saw the implementation of new labour market legislation, and
this has led to an increase in the reported number of people taking
part in employment programmes. However, it is still likely that the
true unemployment rate is higher than the official figures signal.