Youth Employment in Turkey

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Turkey’s recent strong economic growth performance did not translate itself into a matching performance in employment creation. In recent years, unemployment has replaced inflation as the number one economic problem in public opinion polls in Turkey. There is widespread perception of insufficient employment opportunities. This is a concern shared by other emerging market economies as well. Turkey and many Latin American countries have endured decades of economic hardships of chronic inflation, financial crises, and macroeconomic instability. The requisite official line for employment creation was also shared in these countries: A country needs macroeconomic stability for attracting foreign direct investment and job creation. Necessary but not sufficient, this is an obvious labour demand side truth. Economic recovery comes without jobs in some cases, in the emerging markets as well as the U.S., because of productivity increases. Case in point: During the period 1980-2002, annual real GNP growth in Turkey averaged about 4%, compared to average employment growth rate of only 0.8%. Even in the more recent period of 2002 - 2006 when economic growth rate has exceeded 7%, the unemployment rate has stubbornly remained unchanged around 10%. Employment growth rate in the period was also 0.8%. This seems to be a cap for the Turkish economy. It is a failing mark in the Turkish economic grade report.


Hakan Ercan

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