On January 20, 2015, AmCham held a meeting for its IT member companies, to discuss the situation that occurred as a result of the recent dram depreciation against the U.S. dollar, and corresponding inflation, as well as to understand how it affected the IT companies, specifically in the area of employee remuneration.
The participants of the meeting included Georgi Isayan of LTX Credence, Astghik Grigoryan of LTX Credence, Hovik Musayelyan of Synopsys Armenia, Maria Petrosyan of Synopsys Armenia, Gagik Evoyan of Hylink, Armen Baldryan of Unicomp, Irina Dumanyan of Mentor Graphics, Diana Manukyan of National Instruments, Hayk Adamyan of Memoir Systems Inc., and Eduard Kyarunts of AtTask. The meeting was moderated by AmCham Vice President and LTX Credence Armenia Director Georgi Isayan.
The participants discussed the employee salary increase strategies, indexation, out of cycle statutory increase, etc. The main issue, as viewed by AmCham member companies, was justifying the increases to their headquarters. They mentioned that even though the real inflation estimate was around 30 percent in December and 15 percent at this moment, the official sources declare otherwise, stating that the inflation rate is approximately 4.5 percent.
Synopsys HR specialist stated that the Synopsys Branch in Russia had faced the same problem there. According to her information, research conducted within the IT companies in Russia showed that 50 percent of companies are initiating salary increases caused by the increasing inflation rate.
The Memoir Systems Director suggested towait and conduct an independent research of the inflation rate increase when it reaches its peak to justify the need for salary increase at that particular amount.
The Unicomp Director raised two important issues. The first is the increase of the salaries of Armenian state employees (by between 15-20 percent) starting from January 1, 2015, that shall naturally result in the chain reaction of the overall salary increase in the country (independent of inflation). Another issue is connected with the upgrade of Armenia’s position from the World Bank’s lower-income economy country list to the lower-middle income economy that is logically suggesting better standards of living.
The Mentor Graphics Director stated that a serious issue here is the competitiveness of the IT companies in the market. It is important that ITs adopt a unanimous strategy, otherwise the employee retention issue will come into the focus. According to her, another solution for the salary increase issue would be an “out of cycle statutory increase,” in their case.
Another question that the IT representatives raised is the issue of visa rejections of many employees that has been raised within AmCham a number of times. The companies mentioned that there was no significant revision of the policy on behalf of the U.S. Consulate.
As a result of the meeting it was decided: