Everyone's utility bills are rising, but not everyone's salaries are...

On January 7, President Ilham Aliyev signed a decree increasing the salaries of employees in several organizations funded by the state budget. According to the decree, the monthly salaries of managerial and other employees in around 20 institutions (including the Presidium, Apparatus, and Ganja Branch of the Azerbaijan National Academy of Sciences, and the Heydar Aliyev Center) will increase by an average of 15% starting January 1, 2025.

At the same time, a previous presidential decree raised the minimum wage in the country from 345 AZN to 400 AZN. However, at the start of the new year, the Tariff Council's decision also raised the prices of several utility services.

Some private sector employees complain that their unchanged salaries will leave them worse off due to rising costs. They note that salary increases do not apply to them, while prices continue to climb, leaving private-sector workers poorer.

Könül Ahmadova (name changed), who works in a supermarket in Baku, told Radio Azadliq that her salary is 550 AZN: "Food prices are rising, and now electricity and gas bills have also gone up. Everything is getting more expensive except for our wages. When we raise this with management, they respond, 'If you don't like it, quit.' State employees get salary increases, but we are citizens of this country too. Why don't our wages rise?"

The State Social Protection Fund (SSPF) told Turan that from January 1, 2025, the minimum wage across the country will be set at 400 AZN, representing a 16% increase:
"In addition to the increase in the minimum wage, salaries in certain sectors are expected to rise. Overall, more than 700,000 citizens will benefit from this."

The agency clarified that this figure includes 400,000 people in the public sector and 300,000 in the private sector: "It is now mandatory that monthly salaries in the private sector cannot be below 400 AZN."

Economist Natig Jafarli told AzadlıqRadiosu that while the recent utility price hikes may seem minor at first glance, they are not a positive trend: "We experience such price hikes periodically. The underlying causes are not being addressed. These include the inefficiency and lack of transparency in state companies. Unless these issues are resolved, prices will continue to rise. This time, the increase in the minimum wage and pensions is around 15%, while utility tariffs have risen by 6-7%. Looking at it this way, one could say public sector employees may manage to offset the increases to some extent."

According to Jafarli, the problem is that when private sector employees raise concerns about their wages, employers can easily replace them, saying others are willing to work for the same pay: "There are plenty of people looking for jobs. There is a serious issue with job scarcity in Azerbaijan. The government's main goal should be to expand the economy and create new jobs to increase demand. Only then will employers offer attractive conditions to retain good employees."

He noted that the current situation is the opposite: "Therefore, the state must promote a competitive environment to achieve economic activity. Once this happens, the number of jobs will automatically increase, and wages will rise."

Jafarli emphasized that there is currently no data on the number of people in the country earning the minimum wage: "However, we do have information on the median wage. In Azerbaijan, the median wage is close to 500 AZN, meaning half of the 1.7 million formally employed people earn up to 500 AZN."

According to the State Statistics Committee, as of November 1, 2024, there were 1.773 million salaried employees in the country's economy. Of these, 881,700 worked in the public sector, and 891,600 in the private sector. However, official reports estimate the working-age population to be around 5 million, with many believed to be working informally.