Unemployment rises, far from government targets

Unemployment rises, far from government targets

ISTANBUL - Anadolu Agency / Reuters
Unemployment rises, far from government targets

The persons that apply to the Turkish Employment Organization (İŞKUR) to find a job are seen in this photo. The number of unemployed persons totaled to 2.8 million persons in the country, accoring to official data. DAILY NEWS photo, Hasan ALTINIŞIK

Turkey’s unemployment rate rose to 9.8 percent in August with a 1 percent rise year-on-year, according to official figures, but the government aims to reduce it to around 5 percent. Both government officials and the analysts say the seasonal factors will continue to affect the unemployment figures.

The number of those unemployed increased by 361,000 persons in August and totaled to 2.8 million persons in the country, the figures revealed by the state-run statistic body TÜİK on Nov. 15 showed.
The unemployment rate reached 9.8 percent in August with a 1 percent increase from the same month a year earlier. The non-agricultural unemployment rate rose to 12.3 percent with a 1 percent increase as the youth unemployment rate rose to 18.7 percent with a 1.5 percent increase.

Turkey’s growth rate target is likely to be below forecasts, preventing the creation of employment that could reduce unemployment rates. 

“Our employment creation speed has decreased due to global developments and stagnation of domestic demand. We’ll see a rise in unemployment figures in the coming months due to seasonal effects. The change in demand conditions also affects the labor employment market,” Economy Minister Zafer Çağlayan said in a written statement. 

Çağlayan also said that Turkey’s unemployment figures were currently lower than the figures in many European Union member countries. He noted that they aimed to reduce the figures to around 5-6 percent. 

Target of 5 percent

Technology Minister Nihat Ergün said the government aimed to reduce the unemployment rates to below 5 percent or less than 5 percent, during a press meeting. “Our main goal is to catch a performance that can pull down the unemployment to around 5 percent. Today, we are organizing the Research & Development Centers Summit. This kind of work, high added-value products, creation of qualified employment and privileging works that will enlarge the markets, will determine the future in Turkey’s economy,” Ergün said. 

However, with the rise in unemployment due to seasonal factors, the degradation in labor markets seems set to continue in the next months, HSBC Portfolio Strategist Ali Çakıroğlu said. “The 12-month average unemployment rate rose to 9.6 percent, if the current degradation continues even slowly, we see an unemployment rate at 9.7-9.8 percent for this year,” he added.

Burgan Investment Chief Economist Haluk Bürümcekçi said the uncertainty in the markets came after the United States Federal Reserve’s statements that signaled to end $85 billion-a-month bond-buying stimulus program. Bürümcekçi noted that as the uncertainties wouldn’t be cleared, the recovery would be slow.

The number of employed persons increased by 593,000 persons in August, compared to the same period of the previous year, and reached 25.9 million persons. The agricultural employment decreased by 53,000 persons and non-agricultural employment increased by 646,000 persons in this period. The employment rate increased from 46.3 percent to 46.6 percent with a 0.3 percent increase in the same period.

Development Minister Cevdet Yılmaz said the rising employment was qualified at the same time. The number of people that work informally decreased by 379,000 and the illegal employment rate fell by 37.8 percent in this period.