Income distribution is disproportionate

Data on real incomes of the population is one of the key indicators for understanding the nature of a country’s economy and economic growth—especially when it comes to inclusivity. In other words, what percentage of the population truly benefits from economic growth?

So, as of May, the number of employed individuals in Armenia was 790,328. During the same period, the average monthly salary was 294,009 AMD. We often hear about the continuous rise in average wages, which in the realm of propaganda can create the impression that people’s incomes are increasing, and therefore, all assessments claiming we are living better are accurate. But let’s try to understand together—what percentage of the working population actually earns what?

According to statistics on the number of employees and average salaries by type of activity, we get a picture much closer to reality than the aforementioned propaganda. The largest share of employees work in trade, education, and manufacturing industries. The average monthly salaries in these sectors are approximately 212,000, 165,000, and 233,000 AMD, respectively. These people make up 45% of the total workforce.

If we approach it from the opposite angle—trying to understand which sectors have the highest average monthly salaries—we see that the highest earners are in information technology, financial and insurance activities, and mining. Again, we’re talking about average salaries. According to official data, salaries in the IT and financial/insurance sectors are around 1 million AMD, while in the mining sector they are about 530,000 AMD. However, the total number of employees in these sectors combined makes up only 9.5% of the workforce.

This means that as of May in Armenia, around 45% of the 790,000 workers earn an average monthly salary close to 200,000 AMD, and less than 10% of workers fall into the high-salary category. This points to a disproportionate distribution of income, which in turn reflects the non-inclusive nature of economic growth.

Of course, this picture is directly tied to the population’s standard of living and serves as the most realistic response to the propaganda about living better.