Turkey’s unemployment figures ring alarm bells

Turkey’s latest labour force statistics for November 2018 depict an alarming picture for the country’s job market. 

According to figures released by the Turkish Statistical Institute (TUIK) on Feb. 15, the labour force in Turkey, which includes those in employment and looking for work, increased to 32 million in November 2018. 

Those who are unemployed but not looking for a job, including discouraged workers - people who would accept to work if there were jobs available - are not included in the numbers.

The number of people aged 15 and over and not in the labour force in Turkey is 28.6 million and 71 percent of them are women. Turkey ranks last but one among OECD countries for women’s labour force participation, which is at 34.1 percent. 

Unemployment on the other hand, increased to 12.6 percent in November 2018 from 10.5 percent in November 2017, indicating that economic problems in the country have deepened and may affect political preferences - maybe not immediately, but perhaps at some point. 

Non-agricultural unemployment jumped to 14 percent in November 2018 from 12 percent in November 2017. Economists in Turkey believe a 15 percent non-agricultural unemployment rate is alarming for social stability.

Unemployment
Non-seasonally adjusted main labour force indicators, November 2017 - November 2018. (Source: TUIK)

We cannot predict how long the contraction in the economy will last, but as many foresee that negative growth rates will continue at least one more quarter, the non-agricultural unemployment rate could reach more than 15 percent. Let us hope social reactions possible under such a scenario will be handled with respect to the rule of law and in a democratic manner. 

We know that during economic crisis unemployment is usually higher than the rate calculated in official statistics as many who work in non-agriculture sectors usually return to their villages and work in family farms after losing their jobs.

Those people to a large extent have zero marginal productivity but say they are employed when a Turkstat officer comes and asks their employment status. In other words, the unemployment rate does not change as a loss in non-agricultural employment is offset by an addition to agricultural employment, yet those running away from unemployment in urban areas and finding refuge in agriculture in economic terms are still unemployed. 

Figures related to youth unemployment are even more alarming. The rate of unemployment among young people aged between 15 and 24 increased to 24 percent in a year from 19 percent in November 2017. Moreover, almost one quarter of young people are neither in employment nor in education and training. 

The rate of unregistered employment, the ratio of persons working without any social security relating to their main job, did not change and stood at 33.6 percent, implying that the struggle against unregistered employment has also failed. 

We know that the unregistered employment rate is around 90 percent in agriculture, or in other words, we know that those working in agriculture correspond to approximately two-thirds of the people who are working without social security.

The opinions expressed in this column are those of the author and do not necessarily reflect those of Ahval.