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17 op-ed for Ahval entitled “Coronavirus threatens 20 percent unemployment and social collapse in Turkey.”
The IMF’s most recent forecasts on the pandemic’s economic impact predicted a global GDP loss of 3% in 2020, with a 7.5% loss in the EU and a 5% loss in Turkey. Gursel, however, has come up with a “far more optimistic” prediction of zero growth for Turkey. He has “reasoned that after losses of more than 20% in Q2, the economic gears would start turning again over the rest of the year, and growth in Q3 and Q4 could mitigate much of those losses and leave GDP at around last year’s level.”
Even optimistic scenario is “frightening” ​Nevertheless, Gursel advised: “Even if this optimistic scenario is accurate, the level of unemployment and lost income is frightening. The pandemic reached Turkey at a time when unemployment was already high, at slightly above 4mn in January.”
In addition to the 4.36mn people in Turkey officially registered as unemployed as of January by national statistical institute TUIK, there were 2.86mn people listed as ready to work but logged as not having actively sought a job in the previous few weeks. Some 946,000 of them said they had lost any hope of finding employment.
Labour union DISK came up with the January percentage of 23.1% in presenting a wide-scope unemployment rate including people ready to work even though they had not attempted to find employment in recent weeks.
Looking at the official unemployment figure of 4.36mn, Gursel predicted that at least 3mn more people would become unemployed in the coming months. “In this case, even if the [potential] labour force does not grow, we are looking at unemployment above 20%. What is worse, the rate of long-term unemployment—people who have been seeking a job for a year or more—would also leap,” he added.
Turkey’s number of long-term unemployed rose to 750,000 in 2017 and by 2019 it had risen to more than 1mn, equivalent to one out of every four jobless people.
“If the coronavirus does push the number of unemployed people up to 7mn, then an optimistic estimate is that one-third of these will be long-term unemployed, bringing that figure to 2.3mn,” Gursel warned.
Half the minimum wage ​On April 15, the Turkish parliament approved a complex law on banning layoffs for three months amid the coronavirus outbreak. The legislation allows employers to send workers on to unpaid leave for three months, during which period the government will make the payment of TRY1,177 per month for each worker. Yet the monthly net minimum wage stands at TRY2,324 for 2020. The hunger threshold (minimum food expenditure for a four-person family) was at TRY2,345 as of March, according to a monthly survey by yellow labour union Turk-Is.
Turkey has thus created a new category of “employed unemployed” people who still have jobs on paper, but are forced to get by on the $168-equivalent per month provided by the government, according to Gursel.
“For the many unregistered workers who have lost their jobs, and all the street vendors, local tradesmen and artisans whose income has vanished, the package provides nothing. They will have to make do with whatever modest support the Family and Social Service Ministry provides,” he added.
Although the government actually “provides nothing”, it is fond of announcing economic packages and throwing numbers around in the name of financial support.
26​ TURKEY Country Report​ June 2020 ​ ​www.intellinews.com