Turkey: July unemployment rate falls to 10.1%

The unemployment rate in Turkey in July, which was 11.5% in the same month of the previous year, decreased by 1.4 points to 10.1%. When compared to the previous month, it is observed that the adjusted unemployment rate decreased by 0.3 points. While the unemployment rate among the young population was 19.1%; The rate of idle labor force, which is a broadly defined measure of unemployment, rose from 22.5% to 22.5% compared to the previous month.

When we look at the comparable periods, July 2021 – July 2022, it is seen that there was an increase of 1.4 points in the labor force participation rate between the relevant periods, with adjusted data. The workforce, which was 32 million 664 thousand people in the similar period of 2021, became 34 million 52 thousand people in July 2022. The labor force participation rate increased from 51.2% to 52.6%. Again, looking at the seasonally adjusted data; While the employment rate increased by 1.9 points compared to the same period of the previous year and became 47.3%, seasonally adjusted employment decreased by 148 thousand people compared to the previous month.

Despite the decline in TUIK data, both the change in İŞKUR unemployment claims and the idle labor force, which reflects the real conditions, point to an increasing unemployment trend. When we compare it with these conditions, we can talk about a labor market where growth is not directly reflected, unlike the strict labor market conditions in the world. When we consider the unemployment rate, which is still in double-digits, and the youth unemployment, which is almost twice that, and the idle labor force, it is difficult to say that the conditions for the growth of 11.4% in 2021 and 7.6% in the first two quarters of the year are conveyed. At this point, we think that there are still some losses that cannot be replaced after the pandemic. Due to the demographic structure of the population, not being able to transform the opportunity profile, which consists of a surplus of young population, into employment causes unemployment to remain above the level it should be.

Factors such as high inflation at home, tightening of global monetary policies abroad and geopolitical risks may affect the employment investments of companies. In addition, high minimum wage increases created by high inflation can push small SME-style businesses with capital, causing job losses and increasing informal employment. We can expect an increase in headline unemployment rates in the remaining half of the year, when we add the difficulties to be experienced in growth due to the uncertainties in interest, exchange rate and inflation, as well as in access to finance, in the way the economy and monetary policy are implemented.

Kaynak Enver Erkan / Tera Yatırım
Hibya Haber Ajansı