Number of short-term allowance seekers down 961,000 in June: Data

Number of short-term allowance seekers down 961,000 in June: Data

Hacer Boyacıoğlu - ANKARA
Number of short-term allowance seekers down 961,000 in June: Data

The number of workers receiving short-term working allowance decreased significantly in June, when weekend lockdowns and other restrictions to curb the spread of the coronavirus pandemic were lifted, according to official data.

Employees benefiting from the short-term working scheme decreased to 2.3 million in June from 3.2 million in May, the Unemployment Insurance Fund’s figures showed.

The total amount of monthly short-term allowances paid from the fund fell to 3.1 billion Turkish Liras ($451.5 million) last month, down 2.4 billion liras, or 43 percent, from the amount in May.

The Turkish government on June 30 extended the wage support system, which was introduced in late-March, for one month to continue offsetting fallout from the coronavirus pandemic and related lockdowns.

Under the short-term employment allowance scheme, the unemployment insurance fund pays 60 percent of the staff salaries of the employees when a business cuts work hours until Aug. 1.

Any firm forced out of business due to a force majeure, such as the pandemic, can approach the government as part of the short-time working scheme introduced in 2008. The presidential decree on June 30 once again declared the coronavirus pandemic a force majeure.

To become eligible for the short-time working scheme, an employee should have worked for at least 60 days in that firm and have paid 450 days of premiums for the last three years.

The unemployment fund is also paying a daily allowance of 39.2 Turkish Liras ($5.7) to workers forced to take unpaid leave. Between April and July, 1.7 million employees were paid a total of 2.8 billion liras ($407.8 million) under this scheme.

According to another presidential decree published on June 30, a three-month layoff ban was also extended for one month.

During the coronavirus pandemic, which started hitting Turkey in mid-March, the volume of the unemployment fund contracted dramatically, according to its monthly report. As of June 30, the fund’s total volume fell to 117 billion liras ($17 billion), whereas it was around 131 billion liras ($19 billion) at the end of 2019.

In the first half of the year, the fund’s total expenses reached 34.6 billion liras ($5 billion), whereas its total income, which consists of employer-employee premiums, state’s contributions and interest yields, was at 20 billion liras ($2.9 billion). The share of the premiums in the fund’s incomes was around 7.9 billion liras ($1.1 billion), and the state contributed some 2.6 billion liras ($378.6 million), the report showed.

Separately, cash aids to low-income families were also extended for a month at the end of June. Some 18 billion liras ($2.6 billion) had been disbursed so far under the aid programs. Cash aids of 1,000 liras ($144) have been distributed to over 5 million households by the Family, Labor and Social Services Ministry.