Turkey’s official stats agency Turkstat reported on Monday that “the number of unemployed persons aged 15 years old and over decreased by 502 thousand to 4 million 228 thousand persons in the period of February 2020 in Turkey compared with the same period of the previous year. The unemployment rate occurred as 13.6% with 1.1 percentage point decrease. Non-agricultural unemployment rate occurred as 15.4% with 1.5 percentage point decrease”.
Employment rate reported as 43.1%
The number of employed persons decreased by 602 thousand to 26 million 753 thousand persons in the period of February 2020 compared with the same period of the previous year. The employment rate dropped to 43.1% with 1.7 percentage point decrease.
Rate to go up in March and beyond….
“In the three months to February, we saw the total (seasonally-adjusted) number of employed people falling by 767K, with a decline of 495K in February alone. Agriculture stood out with the highest employment loss in this period, followed by services and industry while construction showed a relative strength with a negligible loss, as new jobs posted in December and January were almost offset by a decline in number of jobs for this sector in February”, comments ING Research Team.
However, the unemployment rate has mostly followed a downward path in recent months, recording a drop from 13.1% in November to 12.7% in January, and remaining flat in February. This performance, despite relatively large job losses, is attributable to the downtrend in the labour force participation rate, from 52.6% to 50.7% in this period vs the all-time high of 53.5% recorded in early 2019. This signals that people continue to leave the labour force, not a good sign regarding the perception of households.
The unadjusted unemployment rate came in at 13.6% in February vs 14.7% in the same month of 2019, while the unadjusted labour force participation rate was 49.9% (the first number under the 50% threshold since Mar-14) . This compares with 52.5% in the same month of last year. On an annual basis, the labour force contracted by 1.1 million vs a 0.6 million fall in the total number of employed.
According to official numbers, 3.19 million workers applied to the State Employment Agency for short-term employment allowance as of 27 April. Given that the number shows only applicants out of the employee pool covered by the Employment Insurance Fund, the total employees affected by the pandemic should be higher with the inclusion of those not eligible to apply for short-term employment allowance. The coronavirus economic freeze will further weigh on already challenging labour market conditions, while government actions and the gradual easing of lockdown measures should reverse the trend, especially in the second half.
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