Turkish unemployment reaches historic high

By David O’Byrne in Istanbul

Unemployment rates in Turkey reached a historic high of 15.5 per cent in January according to figures released on Wednesday by Turkey’s institute of statistics.

The rise of 3.9 per cent on the January 2008 figure of 11.6 per cent took unemployment to its highest level recorded since the current method of measuring unemployment was adopted in 2005.

According to the figures a total of 3.65m Turks are now unemployed - an increase of 1.06m on the 2.59m recorded in the same month last year.

Rates for urban unemployment were reported as reaching 17.2 per cent, up 4.2 per cent on the figure of 13 per cent recorded in January 2008 while rural employment was reported as being 11.8 per cent, an increase of 3.4 per cent on the figure of 8.4 per cent recorded in January 2008.

Figures for unemployment among non-agricultural workers showed an even steeper increase at 19 per cent up 5.3 per cent on the 13.7 per cent recorded in January 2008.

However the figures have been challenged by Turkey’s biggest trade union confederation Turk-Is which claims that the true figure is close to 27 per cent.

Turk Is claims that a more accurate assessment of unemployment should also include those who are not actively seeking work but would work if jobs were available, which would include many single women who stay at home and those entering further education as an alternative to unemployment.

The historically high levels come on the back of an eight month period which has seen many major Turkish manufacturers laying off workers.

According to the Istanbul Ready-Wear and Apparel Exporters’ Association as many as 160,000 people have been laid off by textile manufacturers in Turkey since August last year.

Many other manufacturers have opted to halt production for short periods in order to decrease high inventory levels caused by a drastic drop in exports to key European markets caused by the ongoing recession.

Particularly badly hit have been the automotive, white goods and textile sectors.

Turkey’s finance ministry last month announced a drop in purchase taxes on automobiles and white goods in an effort to help manufacturers decrease stocks.

Speaking to the FT Wednesday Ercan Tezer the head of Turkey’s Automotive Industry Federation commented that companies in his sector had been forced to cut production by as much as 60 per cent but because of expectations that demand would rebound had cut their workforces by only around 15 per cent

”Manufacturers are in a difficult position because they need to maintain a highly trained workforce for when demand starts growing again, which we’re expecting next year,” he said.

On Sunday last Turkish Economy Minister Mehmet Simsek and Finance Minister Kemal Unakitan announced Turkey’s EU pre-accession economic programme which envisages industrial production drop by 9.7 per cent during 2009 with the economy shrinking by 3.6-per cent overall.