Real effect of employment mobilization campaign visible in July data
The unemployment trend at the end of 2016 had indicated that the unemployment rate in the first months of 2017 would see a record high for recent years. Indeed, it realized as expected and the unemployment rate in January hit a seven-year high by soaring to 13%. When compared with the same months in previous years, the unemployment figure for February, March, April and May also hit seven-year high levels.
It was a case of “casting shadows before the event.” It was obvious that unemployment rate would soar. To prevent such increases as far as possible and to reverse the trend, the government initiated an employment mobilization campaign. It was a convenient period to start this scheme, as it is known that unemployment in Turkey always peaks in January before declining until the start of summer and then rising again. So, an employment mobilization to be announced in the first months of the year would definitely lead to positive results. Even if there no measures had been taken, the unemployment rate would still have declined after January.
As the unemployment rate was higher by the start of the year, the following decline was observed more acutely. On top of that, some measures were taken and employment was encouraged.
The unemployment rate, which was 12% in January, realized as 10.2% in May and June. The figure released by the Turkish Statistical Institute (TurkStat) last week regarding the average unemployment rate for June, July and Au-
gust is realized as 10.7% in comparison with the July figure.
Considering unemployment realized as 10.2 in May and June, soaring up to 10.7% in July is actually natural despite indicating an increase. As mentioned, in June and the following months it is normal to see unemployment rise. Except for a few years, it has always been that way.
The real comparison regarding unemployment should be made with the same month of the previous year – and that statistic shows us that the unemployment rate didn’t change as it also stood at 10.7% last July.
Contribution of mobilization
First of all, I should remind readers that there are no precision scales to measure the exact contribution of employment mobilization. What we can do is look at some indicators about the workforce to see how they changed this year from January to July, how the change was in previous years and compare them.
For example, employment rose by 2.1 million between January and July this year and the unemployment figure declined by 542,000.
What about last year? The workforce and employment rose by almost the same – 1.4 million – in the same period last year and unemployment rose by 34,000. It means unemployment declined by 542,000 this year between January-July, whereas it rose by 34,000 in the same period last year.
It’s a positive scene if we compare this year only with the previous year. But we should not forget the fact that last year had its own unique series of events that negatively impacted on employment. That’s why it’s better to compare this change with the previous year.
The workforce increased by 1.5 million this year from January to July. It had increased by 1.6 million in the same period in 2015. Employment rose by 2.1 million this year, whereas it rose by 1.9 million in 2015. The number of unemployed people declined by 542,000 this year, but declined by 289,000 in the same period in 2015.
So the contribution of the employment mobilization campaign is significant when compared to the previous year. But frankly the change is not extraordinary when compared to 2015 – a year where the effect of elections didn’t really reflect on figures until after the July figure was released. In short, employment mobilization did indeed make a positive contribution, but there is no need to blow it out of proportion.