ArmInfo. Armenian Minister of Economic Development and Investments Tigran Khachatryan does not agree with the statement that reducing the state apparatus will lead to an increase in unemployment, a decrease in consumption and, as a result, threaten the prospect of economic growth.
"I am sure that people who will be left without work as a result of optimization in state structures will find new opportunities to show their worth in the private sector," Tigran Khachatryan said on February 8, answering a question from ArmInfo.
According to the Minister, the funds saved as a result of personnel optimization will not be frozen. They will be allocated at increasing the wages of those who will remain as employees, as well as at purchasing goods and services. And this, according to Khachatryan, means that these funds will be indirectly allocated to those individuals who are engaged in the private sector in more productive work. "That is, in general, this expenditure item in the economy will not be reduced, but on the contrary - increased, since the budget of 2019 provides for more spending in the current year than it was in 2018. Thus, from a macroeconomic point of view, the problem with a decrease in consumption doesn't really exist, "he pointed out. At the same time, the Minister of Economic Development admitted that, following the results of the restructuring of the state apparatus, there will be those who will benefit and those who will bear a heavy burden.
To the remark that the human resources capacity of the private sector is limited, and the market is very small and not everyone can do business, and whether the state intends to take care of those who will be ''left in the basket'' the Minister replied: "The market is a phenomenon that dictates a certain demand for specialists, labor. Anyone who understands the demand of the market, can make some effort and retrain. And the state creates a guarantee system, which is aimed at increasing the possibilities of generating large revenues in the private sector. "
To note, the government of Nikol Pashinyan initiated the process of restructuring the state apparatus in order to optimize state budget expenditures. Optimization, according to various estimates, will affect from several hundred to thousands of people. According to the authors of the initiative, the majority of the dismissed people should find their niche in the private sector. Nevertheless, many experts have expressed concerns regarding the fact that the private sector will be able to involve so many specialists. In addition, the desire of a "private entrepreneur" to hire a specialist who has been dismissed precisely because of his/her lower qualifications is questioned. Experts say that there is another aspect as well. Unemployment also affects consumption, and in conditions of reduction of sales volumes, there is a risk that importers and businesses will decide to increase margins and prices in order to recover lost incomes.