Turkish Forum

Tag: Unemployment

  • One in five young people jobless in Turkey

    One in five young people jobless in Turkey

    One in five young people jobless in Turkey

    Turkey’s jobless rate had edged up 0.3 percent in December over the same month a year ago to reach 10.1 percent

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    One out of five people between the ages of 15 and 24 were unemployed in Turkey in December, with the country’s youth unemployment rate hitting 19.8 percent, data from the Turkish Statistics Institute (TurkStat) showed on Friday.

    TurkStat announced that Turkey’s jobless rate had edged up 0.3 percent in December over the same month a year ago to reach 10.1 percent. This marked the first return to double digits in unemployment figures since February 2012. The institute also stated that the unemployment rate for non-agricultural jobs had increased by 0.4 percent to 12.4 percent in December, while youth unemployment grew to 19.8 percent, a 1.7 percent increase over the same period of 2011.

    Turkey is not the only country suffering from high youth unemployment figures, one of the most critical dimensions of unemployment, socially and politically. December’s figures showed that the Turkish youth jobless rate remained below EU levels. The youth unemployment rate was 23.4 percent in the 27-member EU and 24 percent in the eurozone in December, the European statistics office EuroStat had earlier reported.

    Friday’s figures put the total number of people without a job in December at 2.79 million. TurkStat’s figures also show that Turkey’s labor force grew to 24.76 million in December, up from 23.67 million in the same month of the preceding year. The labor force participation (LFPR) rate was calculated at 50 percent in December.

    The statistics office last week announced that Turkey’s unemployment had dropped to 9.2 percent last year from 9.8 percent in 2011.

    via One in five young people jobless in Turkey | Economy | World Bulletin.

  • Turkey’s employment rise to be three times higher than Europe’s

    Turkey’s employment rise to be three times higher than Europe’s

    Turkey’s employment rise to be three times higher than Europe’s: OECD

    Turkey will also be the third after the U.S. and Mexico which will create highest employment opportunity among OECD countries.

    World Bulletin / News Desk

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    According to predictions of OECD, 1.047 million more people will join labor force in Turkey in 2013 and 2014.

    This figure will be 372,973 in Europe in the same period.

    Turkey will also be the third after the U.S. and Mexico which will create highest employment opportunity among OECD countries.

    Currently, 159.6 million people are working in European zone which is comprised of 15 countries.

    via Turkey’s employment rise to be three times higher than Europe’s: OECD | Economy | World Bulletin.

  • Turkey: “unstoppable” for long?

    Turkey: “unstoppable” for long?

    by Daniel Dombey

    Whatever criticisms you can make of what one analyst labels Turkey’s “unstoppable” economy, there’s one thing the country’s economic boom is thankfully free of. It’s not an American style jobless recovery.

    Istanbul Getty

    Quite the contrary. In the last year Turkey has created some 1.8m new jobs. Figures released on Thursday showed unemployment fell to 8.8 per cent to September, the lowest level since 2005 and down from a 2009 peak of more than 16 per cent.. On a seasonally adjusted basis, unemployment fell to 9.2 per cent, also the lowest level of recent times. But analysts are almost universal in predicting that things won’t stay quite this sweet for long.

    Unstoppable it may be for the moment, but just about no one expects Turkey to keep up its current hectic pace of economic expansion – 9.6 per cent for the first nine months of this year compared with the same period in 2010.

    Indeed, on Thursday Merrill Lynch added its voice to Goldman Sachs’ in warning of the risk of an imminent recession.

    “With the complexity of central bank policy and the need for corporates to absorb their foreign exchange mismatches, the result could manifest itself in a recession which we do not believe is fully appreciated by the market,” Merrill said, in an apparent reference to the central bank’s sensationally complicated interest rate corridor policy and the $59bn of dollars in short term obligations held by Turkish corporates, much of which come due in the next few months.

    The interest rate corridor policy involves rationing how much the central bank lends commercial banks at the benchmark rate of 5.75 per cent rather than more expensive rates of 12 and 12.5 per cent. It allows the central bank a huge amount of flexibility over rates, but has led to widespread calls, particularly from abroad, for greater transparency and predictability.

    Indeed, so great is the confusion about what interest rates actually are that some bankers say it has become hard to perform an old-fashioned carry trade, and that many portfolio investors are just waiting until the benchmark rate is increased to deal with Turkey’s bloated current account deficit and rising inflation.

    Still, that’s not to say there isn’t any foreign investment. Just this week, the Malaysian sovereign wealth fund Khazanah Nasional moved closer to completing a deal whereby it would take a majority stake of Acibadem, a big Turkish hospital chain, through direct and indirect holdings. Since Acibadem, which runs 11 hospitals and other medical facilities, has market capitalisation of about TL2.5bn ($1.3bn), it is not a trivial deal.

    So while Turkey may be headed for tougher times in coming months – and the jobs bonanza seems set to slow – its longer term growth story is still bringing investors in.

    via Turkey: “unstoppable” for long? | beyondbrics | News and views on emerging markets from the Financial Times – FT.com.

  • Are Turkish Youngsters Too Smart?

    Are Turkish Youngsters Too Smart?

    by Justin Vela

    Turkish university graduates struggling to find employment in their fields of study are often settling for menial part-time jobs until better times come around. The unemployment for Turks between the ages of 15 and 24 stands at 18.6 percent – nearly double the national average. (Photo: Justin Vela)

    To get a sense of the scope of Turkey’s youth unemployment problem, you don’t have to look much further than downtown Istanbul’s inexpensive cafes, which are invariably jammed with 20-somethings during working hours. The country’s challenge isn’t simply one of creating more jobs to handle the rising tide of young people entering the work force, it’s also a matter of creating quality positions that can meet the heightened expectations of job-seekers.

    Setting the stage for the unemployment conundrum is the demographic fact that more than half of Turkey’s estimated population of 75 million people is under the age of 30. And not only are there more youngsters seeking employment, they tend to be better educated than their elders.

    Over the past decade, many 20-somethings in Turkey have become the first members of their respective families to attend university or other institutions of higher learning. Over the same period, the country has experienced robust economic growth — 8.2 percent in 2010, and averaging 6 percent annually from 2002-2008. But the growing economy hasn’t been able to create jobs fast enough to handle the increasing number of youths entering the labor force. That has left many newly minted graduates unable to find a job to match their skills.

    Turkey’s official overall unemployment rate stands at 9.6 percent. But the rate nearly doubles to 18.6 percent for Turks between the ages of 15 and 24. The unemployment rate is partly a reflection of a surge in the number of Turks graduating from universities, medical and vocational schools each year — up 155 percent since 2000 to 573,159 in 2010.

    “There are too many young people,” commented Ilayda Karakas, a 24-year-old who moved from the western city of Bursa to Istanbul in search of a job as a graphic designer. “There are too many universities. Too many people looking for the same job.”

    Unable to find jobs in their fields of specialty, many young Turks instead fall back on low-paid positions in fast-food chains or temporary work, most of which is unofficial or part of the country’s massive grey economy.

    After a fruitless two-year job hunt, 27-year-old Zeynep Yıldırım, who graduated from an Istanbul university in 2009 with a degree in computer engineering, ended up working in her family’s grocery store in the Aegean resort town of Bodrum. “I feel horrible, terrible, of course,” she said. “Day by day, I am going to forget what I learned.”

    Ümit Efendioglu, director of the International Labor Organization’s Ankara office, identified a lack of adequate job-market preparation among Turkish institutes of higher education as a contributing factor in Turkey’s youth unemployment problem. Technical and creative-thinking skills remain in short supply, particularly among graduates of vocational schools, she said. “There is a disconnect with industry and the private sector,” Efendioglu said. “The labor supply does not match the demand” for employees with highly specialized post-secondary degrees to work in scientific and technical sectors that require solid R&D or management skills.

    Structural problems in Turkey’s labor market also play a role, commented economic consultant Emre Deliveli, a columnist for Hürriyet Daily News. The need to pay high severance packages – one month’s salary for each year of work – to former workers means that turnover at Turkish companies is not robust. Those who do hire do not always recognize diplomas from vocational schools, from which 231,601 Turks graduated in 2010, nearly a 200-percent increase from a decade ago. The preference is to keep entry-level salaries low or, in many cases, off the books.

    “Young people are avoided or hired informally,” noted Dr. Seyfettin Gürsel, an economist at Istanbul’s Bahçeşehir University. Students who attended prestigious universities in Istanbul or Ankara sometimes are more likely to get jobs simply because Turkish companies like to show off highly accredited employees, added Deliveli.

    Reflecting on her own six-month job search, 25-year-old Rabia Özkutlu, a recent graduate of Istanbul’s Beykent University with a degree in business management, said that her salary expectations — a monthly salary of 1,500 liras (about $836 as of the middle of November 2011) — was a stumbling block. Most potential employers only wanted to pay new employees a maximum of 1,200 liras (about $678) per month for full-time employment, she added. “We are used to the money our parents give us,” she said. “We cannot live [as accustomed] on this salary. If [employers] don’t agree with you, they say, ‘Next!’”

    The Ministry of Labor and Social Security declined to comment to EurasiaNet.org about its ideas for improving the employment situation for young job seekers.

    The ILO’s Efendioglu said that, as an incentive to hire young people, the government has given companies a five-percentage-point reduction in the amount of money they must pay each year for retirement and healthcare benefits for employees aged between 18 and 29 years old. The Turkish Employment Agency also is currently carrying out a “provincial market needs assessment” to determine labor supply trends in different locations around the country, she added.

    So far, the issue of youth unemployment has not resonated politically. Among Turkey’s mainstream opposition parties, interest tends to gravitate more toward issues with regular news coverage, such as constitutional reform. Young people, meanwhile, haven’t been very politically active of late. For example, youth turnout was low at a scantily attended Occupy Istanbul event staged in early November.

    Given the circumstances, as well as the potential for an economic downturn, more and more young people seem to be revising their expectations. Twenty-five-year-old, multilingual Ozge Akkaya graduated this year with a history and English degree from Istanbul’s prestigious Boğaziçi University, and accepts that she might not find work in her fields of choice. Instead, she is translating a book from Italian to Turkish. The job is unofficial, but “I can’t say I am unemployed,” she said.

    Editor’s note:
    Justin Vela is a freelance reporter based in Istanbul.
  • Turkish Government Under Fire

    Turkish Government Under Fire

    Turkish Government Under Fire for Delaying Response to the Global Financial Crisis

    Publication: Eurasia Daily Monitor Volume: 6 Issue: 32
    February 18, 2009
    By: Saban Kardas

    An announcement of recent economic indicators on Monday by the Turkish Statistical Institute (TUIK) has revealed that the number of unemployed people rose by 645,000 over the previous year, reaching 2.99 million in the period from September through November 2008. This represents an increase in the unemployment rate from 10.1 percent during the same period of 2007 to 12.3 percent in 2008. While the unemployment rate in rural areas was only 9.3 percent, it reached 14.2 percent in urban areas, and was 23.9 percent among the youth. The number of employed people reached 21,315,000, marking a 448,000 increase over the previous year. Of the entire pool of unemployed, around 72.6 percent were men, and about 59.4 percent did not have a high school diploma. Some 26.6 percent had been seeking employment for more than a year (Hurriyet Daily News, February 17, www.turksat.gov.tr).

    Rising unemployment, reaching the highest level since 2005, has brought attention to the Justice and Development Party’s (AKP) handling of the Turkish economy and whether it has taken the necessary precautions to weather the global financial crisis. Critics believe that unemployment figures are only one indication of how the government has failed to comprehend the depth of the crisis and formulate prompt responses. Indeed, earlier economic data released by the TUIK appear to lend support to the critics. At the end of last year TUIK announced that the economic growth rate had dropped to 0.5 percent in the third quarter of 2008 and would continue to decline in the last quarter (Sabah, December 16). Similarly, the country’s industrial production output declined in December by 17.6 percent on a year-to-year basis (Cihan Haber Ajansi, February 9). To make matters worse, the industrial capacity utilization rate dropped to 63.9 percent in January, marking its lowest level in the past 18 years (Radikal, February 11). Moreover, according to the Turkish Employment Organization (IS-KUR), the number of people looking for a job rose by 95 percent in January compared with the previous year, reaching 151,530 (Radikal, February 13).

    According to its critics, the government was slow to recognize that the global recession would inevitably result in the contraction of the Turkish industrial sector and result in unemployment. According to Mustafa Boydak, the head of Chamber of Industry in Kayseri, one of Turkey’s industrial centers in Anatolia, there were already signs of the crisis in the first half of 2008 and business circles had clearly explained the situation to the government, providing adequate warning. The lack of communication between Prime Minister Recep Tayyip Erdogan and economic managers, however, prevented a candid assessment of the crisis on the part of politicians, and Turkey fell behind other countries that have taken measures to assuage the economic calamity. Boydak cites three factors bedeviling the industrial sector: an inability to procure loans at reasonable conditions; difficulties with exports; and contraction of the domestic market (Referans, February 16; Hurriyet Daily News, February 17).

    On February 15 major Turkish unions and vocational organizations organized a joint meeting in Istanbul to protest economic policies. In a rally entitled “We Will Not Pay the Price of the Crisis,” workers and public employees called on the government to introduce policies to address the rising unemployment immediately (Anadolu Ajansi, February 15).

    Following the announcement of official unemployment rates, the Turkish Confederation of Employers’ Unions (TISK) issued a statement calling on the government to take preventive measures. TISK claimed that among developing countries Turkey ranked near the top in terms of decline in industrial production and growth rate and in increasing unemployment. Based on the recently released figures, TISK believes that Turkey is one of the hardest hit countries by the economic crisis and that unless the government acts quickly to introduce a package to stimulate demand and solve financing problems, the situation might become even worse (Anadolu Ajansi, February 16).

    For its part, the AKP government does not seem to be alarmed by the recent economic figures. Speaking to the NTV news station, Industry and Trade Minister Zafer Caglayan said that the rise in unemployment had been anticipated and that if the government had not taken precautions in 2008, the numbers would have been even higher. Noting that the government expected the crisis to influence the Turkish economy for the next six to seven months, Caglayan assured the market that the government had a plan of action. Despite the repercussions of the crisis in the real sector, the financial sector was not as badly hit as in other countries, and this was to Turkey’s advantage. He especially rejected calls to introduce an “economic package” simply because other countries were doing so, and added that Turkey would deal with the crisis by taking its own unique conditions into account, echoing Erdogan’s oft-repeated argument that Turkey will handle the crisis according to its national interests. Caglayan also announced forthcoming measures to stimulate the automotive and textile industries (www.ntvmsnbc.com.tr, February 16).

    Indeed, the government has already forwarded the first concrete package to the Turkish parliament. After approval by the Planning and Budgetary Commission, the parliament began debating the package on February 17. The main goal of the package, which includes short- and mid-term measures to address the economic crisis, is to stimulate employment (ANKA, February 17).

    The government is also under pressure for delaying the conclusion of a loan with the International Monetary Fund (IMF), and critics believe that this is mainly because of short-term political considerations in anticipation of forthcoming local elections. The government, on the other hand, argues that the IMF conditions would have limited Turkey’s flexibility in dealing with the crisis, perhaps even exacerbating the problems in unemployment and growth (www.ntvmsnbc.com.tr, February 16). In the meantime, Turkey and the IMF have taken a break from negotiations to clarify their positions on the remaining points of disagreement (EDM, January 29). Despite the Turkish side’s assertion that there has been progress in negotiations, it is still unclear when an agreement might be reached (www.cnnturk.com, February 17).

    Although the AKP government believes that it is doing everything to manage the global crisis on the basis of Turkey’s national interests, the market has grown increasingly anxious about the government’s delay in implementing efficient measures. It is hoped that the economic stimulus package and a deal with the IMF, should there be one, will not be too little, too late.

    https://jamestown.org/program/turkish-government-under-fire-for-delaying-response-to-the-global-financial-crisis/