The unemployment rate in Turkey in December, which was 12.7% in the same month of the previous year, decreased by 1.5 points to 11.2%. When compared to the previous month, it is observed that the adjusted unemployment rate decreased by 0.1 points. While the unemployment rate among the young population is 20.8%; non-farm unemployment stood at 12.8%.
When we look at the comparable periods, December 2020 - December 2021, it is seen that there was an increase of 3.8 points in the labor force participation rate between the relevant periods, with adjusted data. The workforce, which was 31 million 6 thousand people in the similar period of 2020, became 33 million 935 thousand people in December 2021. The labor force participation rate increased from 49.1% to 52.9%. Looking at the seasonally adjusted data; While the employment rate increased by 4.2 points to 47% compared to the same period of the previous year, seasonally adjusted employment increased by 236 thousand people compared to the previous month. The rate of idle labor increased to 22.6%.
In the light of leading indicators, we observe that there is a labor force data compatible with economic growth and sectoral activities. In this context, the current trend in the unemployment rate continued in December and a limited decrease was achieved compared to November. Industrial production continues its recovery trend compared to the previous year, and despite some slowdown risks, we observed in the PMI data that the manufacturing sector continued to increase employment. When we look at other sectoral breakdowns; The slowdown of agricultural production due to reasons such as the economic situation, seasonal conditions, product cost, etc., and the slowdown of the construction sector due to the interest rates and price trends affect the construction employment negatively. In 2022, we expect a slight slowdown in growth. Depending on the recession in economic growth, we can observe the slowdown effect in general employment creation. Along with January and February, factors such as exchange rates, production costs, personnel costs due to the minimum wage increase must also be taken into account.
We think that there is a lack of value creation, efficiency and productivity at the point of creating permanent employment in the economy. Especially due to the changes in employment, business models and digitalization that emerged during the pandemic process, we watched the rotation between the manufacturing and service sectors due to both the preferences in the preferences and the economic conditions. We know that those who were away from their main jobs during this period had to work in temporary jobs in the service sector to protect their income. Now at this point, job creation is already dominant in the services sector. This actually leads to a lack of productivity, which is the basic need of the economy at the point of transformation and sustainable growth in the industry, especially in the manufacturing sector. At this point, Turkey needs to specialize in productivity-oriented high-tech sectors, make new investments and employ qualified workforce. With the revival of the economy or the opening of sectors, it should also look at the transition between sectors with new labor force participation. For example, the important part of the transition from the service sector to the production side.
Falling real wages with inflation is also a problem. We know that most companies in the private sector make their New Year's hikes below inflation. In addition, price increases in the first months of the year cause new wages to succumb to inflation more. In this period, factors such as the cost management of companies and the desire to change jobs among individuals may limit the participation in the new workforce or cause an increase in the idle workforce. There are some difficulties in creating permanent jobs in the coming months.
Kaynak Tera Yatırım-Enver Erkan
Hibya Haber Ajansı