Shorter working hours pose risk to Armenia`s economy - Mantashyants  business club

ArmInfo. The legislative initiative of the Ministry of Labor and Social Affairs of Armenia to reduce the working day to 7 hours a day (currently 8 hours) and, accordingly, from 40 to 35 hours a week, while maintaining wages, is not supported by sufficient research and scientific argumentation. At the same time, it contains many risks for the development of the economy and human capital. This is the position of the Mantashyants business club. 

The draft law was recently posted on the website of  legislative initiatives e-draft.am on December 19 for public and  expert discussion. 861 people have already voted for it, 31 against.  According to the authors of the draft, who refer to the experience of  France, Germany, Sweden, Belgium, Austria, Norway and Iceland,  reducing working hours will not have a negative impact on the  economy. Moreover, it will contribute to increased productivity.  , - the rationale for the draft law says. It is noted  that the World Health Organization has published studies showing that  long working hours can cause cardiovascular diseases, contribute to  depression and stress.

Meanwhile, as Mantashyants believes, the document is of concern  because, first of all, it lacks an impact assessment, which is  necessary for an initiative of such a scale. , they noted.

The Union experts also noted methodological errors.

However, in all countries with GDP per capita close to Armenia (from  7,000 to 15,000 US dollars GDP per capita), such as Turkey,  Kazakhstan, Mexico, Argentina, Uzbekistan, Georgia, Peru, Belarus,  China, etc., the duration of working hours is 40-48 hours and not  less>, they pointed out. Thus, the ministry compared .

In they note that even in developed countries the  results of reducing working hours are not clear. There are areas  where such changes have yielded positive results, and there are those  where - on the contrary, which indicates that the long-term  consequences of reducing working hours have not yet been fully  studied. For example, reducing the working day in Sweden had a  negative impact on GDP.

Meanwhile, the Union believes that the real problems of the Armenian  labor market are ignored.

Increasing free time may be important in developed countries such as  France or Sweden, but in Armenia the priority issues are different,  for example, the ability to cover the costs of the minimum consumer  basket>, they noted.

In addition, experts fear that in practice, there is a real threat of  a decrease in wages or no increase. , they specified.

does not consider the argument of the Ministry of  Labor that this regulation will contribute to the growth of labor  productivity to be convincing. They note that labor productivity in  Armenia has been growing sharply in recent years, and the growth rate  is unlikely to accelerate. At the same time, in terms of labor  productivity, the Republic of Armenia is still in a very bad position  compared to other countries, and the reduction of working hours will  weaken the competitiveness and sustainability of the Armenian  economy, which is unacceptable in the context of modern challenges.  Thus, working hours in Turkey are 45 hours a week, in Iran - 44  hours, in Georgia, Azerbaijan and all other EAEU countries - 40  hours.

At the same time, they emphasize, the application of the law will  lead to the establishment of unequal conditions and unfair  competition between honest and unscrupulous businesses.   , - the Union summarized.