In June, the unemployment rate in Turkey was realized as 13.4% compared to the same month last year’s 13%, with an increase of 0.4 points. When compared to the previous month, it is seen that the unadjusted unemployment rate increased by 0.5 points. Seasonally adjusted unemployment rate was announced as 14.3% with an increase of 0.5 points compared to the same month of the previous year and an increase of 0.2 points compared to the previous month. While the youth unemployment rate was 26.9% according to the refined data; Non-agricultural unemployment was 16.7%.
When we look at the comparable periods June 2019 - June 2020, it is seen that there is a 4.3 point decrease in the labor force participation rate between the relevant periods with adjusted data. The workforce, which was 32 million 502 thousand people in the similar period of 2019, became 30 million 366 thousand people in June 2020. Labor force participation rate decreased from 52.9% to 48.6%. Participation rate had declined to 47.7% in May, there is an improvement compared to the previous month and it seems to have an impact on the increase in unemployment rate. Again, looking at seasonally adjusted data; While the employment rate decreased by 4 points compared to the same period of the previous year and became 41.6%, there was an increase of 673 thousand people in seasonally adjusted employment compared to the previous month. During this period, seasonally adjusted employment increased by 36.000 people in the agricultural sector, 25.000 people in the industrial sector, 141.000 people in the construction sector, and 230.000 people in the service sector. While the improvement in economic activity with the normalization since June also explains the employment increase in sectoral breakdowns, it is seen that the normalization in the service sector, which experienced the most important employment loss during the pandemic, was faster than the others and more limited in other sectors.
While the deterioration in the unemployment rate was limited in the pandemic period with the effect of economic measures and the incentives to firms to protect employment, it is seen that the improvement in the labor force participation rate compared to the previous month due to the normalization since June was effective in the increase in the unemployment rate. On the other hand, although the economic activity recovered in June, July and August with normalization, it also shows signs of loss of momentum as of the end of August. In this period, the rapid increase in the unemployment rate was prevented, especially within the framework of the ongoing incentives of the government. Short work allowance, dismissal ban and cash wage support continues; The short-time work allowance and the ban on dismissal were extended for another 2 months. Government support can also be expected to continue according to circumstances.
As the unemployment data is 3 months behind, we will see the effects of the increasing economic activity with the normalization in the data for July and August period. Regarding the following periods; Factors such as tightening financial conditions, slowdown in economic activity, and the possibility of withdrawal of government incentives may cause the unemployment rate to increase or remain high. In addition, the pandemic uncertainty and the high number of cases will affect the decisions of companies on investment and recruitment, so the pace of opening new job positions may be behind the increase in participation rate.
Kaynak Tera Yatırım
Hibya Haber Ajansı