Wednesday, December 6 2017 14:47
Naira Badalian

Chairman of the Employers `Union of Armenia: the low level of graduates` training is the main obstacle for business development

Chairman of the Employers `Union of Armenia: the low level of  graduates` training is the main obstacle for business development

ArmInfo. 72% of employers are  dissatisfied with the professional training of personnel and their  education. Answering the question of ArmInfo, the chairman of the  Union of Employers of Armenia Gagik Makaryan stated. Today, on  November 6, the Union of Employers presented its vision of  sustainable development of entrepreneurship in the Republic of  Armenia, where the main obstacles to the development of the  environment are associated with low level of education, shadow  economy, corruption and unequal competitive conditions in the  business environment, inadequate legislative regulation,  inaccessibility of financial resources, trade and energy.

According to Makaryan, the main task of business in Armenia is the  lack of competent personnel. Annually the education sector receives $  320mln, of which $ 250mln of budgetary funds, $ 50mln universities  receive in payment for tuition and $ 20mln within various programs.  However, today the level of education and professional literacy of  the staff leaves much to be desired. In addition, the education  system in Armenia is inertial and very slowly adapts to the world  trends and current demands of the employer. To date, about 50% of  students receive a liberal arts education, which means that in the  near future their demand for the market will be very limited. And  only 14% are technicians who will have a great opportunity in the  labor market.

According to expert, according to research, the annual labor  productivity in Armenia is $ 8,600. In Europe, the figure is $  100-120 thousand. As a result of this, Armenia annually loses its  competitiveness. Losing their productivity, the employer is forced to  go into the "shadow", because fully working legally and  transparently, due to the current tax settlement, they simply close.  According to various international structures, the "shadow economy"  in Armenia has increased to 35-50% in recent years. However, at  present, according to the State Revenue Committee, the "shadow" has  significantly decreased, in particular, by the collection of taxes -  up to 30%. According to the expert, the "shadow economy" is still not  ready to give up its positions and at least 40% are still working in  the "shadow".

In addition to problems with the training of personnel, 17.7% of  employers in Armenia are called corruption and bribery as barriers to  the development of entrepreneurship. 33% of companies said they were  forced to conspire with officials - to the so-called "quick pay" to  get the service at the proper level. At the same time, despite the  reforms initiated by the authorities, the tax burden to this day by  business entities (33.7%) continues to be viewed as an instrument of  pressure, and 26.7% note the existence of monopolies in the sphere.  In this context, the Employers' Union calls for toughening the fight  against corruption, developing adequate, flexible tax legislation,  significantly reducing the bureaucracy and improving the work of the  inspection bodies, and at the same time more effectively informing  the business on the current reforms in the sphere.

According to Gagik Makaryan, limited financial resources - the  inaccessibility of loans due to high interest rates and unsustainable  collateral, in particular for SMEs, is also a barrier to business  development. 82% of respondents noted that they can rely only on  their own resources on the issue of financing, 37.7% noted that  financial programs are not adapted to the existing realities for them  in Armenia. The next challenge for local business is energy and  energy supply issues - more than 80% said that power outage is a  serious problem for business. In this context, the organization calls  for the development of flexible financial support tools for local  businesses, and ensure uninterrupted power supply by introducing new  power stations.

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