Turkey’s May unemployment rate to be released
Turkey will today release its unemployment rate for May.
April’s unemployment data showed a surprising year-on-year improvement, with 2019/20 figures of 13% and 12.8%, respectively. However, the implications have been disputed by Turkish economists, who argue that a narrow statistical analysis was incorrectly restricted to those citizens who are actively but unsuccessfully looking for work. The methodology misses those still employed but on unpaid leave, as well as unemployed citizens who have terminated their job searches.
May’s figures will likely mask the true scale of Turkey’s unemployment predicament. April’s figures were likely skewed by the ban on lay-offs imposed by the government, as companies have been forced to place workers on indefinite unpaid leave, leaving them statistically employed but unable to work. On July 23, President Recep Tayyip Erdogan was given the power to extend this ban—reviewable every three months—until next July.
Erdogan will likely rely on low unemployment figures to counter growing criticism of his government’s economic response to COVID-19; some critics argue that real unemployment is at 50%. Expect the president to extend the lay-off ban for at least another three months, which would necessitate an extension of the government grants propping up the vast non-working population. This could quell domestic opposition but risk boosting government debt, which has only been brought under control in recent years to a respectable 30% of the domestic GDP.
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