The rate of inflation growth will "eat up" the increase in wages and pensions

Baku/20.12.21/Turan: President Ilham Aliyev signed several decrees to increase various benefits and pensions from January 1, 2022. According to the Ministry of Labor and Social Protection, the increase in benefits and stipends applies to a total of 732,000 people, including 132,000 doctoral students. An additional 200 million manats are allocated annually for this increase.

On December 17, the President of Azerbaijan signed a decree setting the minimum wage in the country from January 1, 2022 at the level of 300 manats.

Is the increase sufficient to meet the needs of the population? Will they be able to offset inflation?

Economist Natig Jafarli brought clarity to these issues in the "Difficult Question" program.

In fact, several more decrees are expected to be signed one of these days as the next step. In particular, about the indexation of pensions. Considering that there are 1.3 million pensioners in the country, it will cover approximately 900 thousand people. Since this is the number of pensioners receiving the minimum, i.e. a pension that meets the standards. Therefore, an increase in their pensions is expected.

917 thousand citizens receive salaries and the state budget. The increase in the minimum wage in Azerbaijan to 300 manats will also serve to a certain increase in their salaries. It is expected to be in the range of 10 to 30%, according to the staffing table related to the period of their activity (indiscriminate). The increase in the minimum wage and pensions is naturally a positive thing. However, this increase is intended to offset to some extent this year's inflation. But if we consider that inflation will continue next year, as well as the rate of its growth, then at the beginning of next year it may "eat" the increase in wages and pensions.

This year, the official inflation rate, even according to the Central Bank, has reached double digits, i.e. approached 12%, and food inflation even reached 15%. Naturally, in reality, the inflation rate is higher.

Considering that the population of Azerbaijan spends a significant part of their earnings on food, according to official figures, it turns out that Azerbaijanis spend 52% of their income on food products. This is a very large figure and should be regarded as an indicator of the poverty of the population. --0--