* Photo: Anadolu Agency (AA)
Click to read the article in Turkish
Released by the TMMOB Chamber of Mechanical Engineers and prepared by economist and writer Mustafa Sönmez every month, the 73rd bulletin on the problems of industry in Turkey has been published.
This month's bulletin has specifically addressed the "effect of economic growth on labor force, distribution of income and employment."
Based on the data of the state agency Turkish Statistical Institute (TurkStat), Central Bank, Ministry of Treasury and Finance, Ministry of Trade and Banking Regulation and Supervision Agency (BDDK), the bulletin of the Chamber has drawn attention to the "lack of quality" of the course of growth that has been followed in Turkey as well as to the fact that labor force cannot benefit from the growth, they lost their income share when compared to the previous period and such a growth does not create employment, does not lead to a decrease in unemployment and is not sustainable.
'Growth has not been beneficial for labor'
Some highlights from the bulletin are as follows:
"In the second quarter of 2021, as had been expected, a sensational growth rate of 22 percent was announced; behind this façade, it was known that the shrinkage of 10.4 percent observed in the second quarter of 2020 would have a mathematical effect on this. This growth, which exceeded base effect, does not look sustainable and, considering its consequences, it has not been a 'beneficial' growth, especially on the part of the labor.
"There emerged no positive outcomes in either sharing the national income nor enabling the unemployed people to find a job. Of the economic growth in the second quarter of 2021, the labor force experienced a 4-point loss of income when compared to the previous period.
While their share in the gross value added was 37 percent in the second quarter of 2021, it dropped to 33 percent in the second quarter of this year.
Unemployment, high inflation rates...
Noting that the economic growth in the second quarter of 2021 "has not done any good to unemployment as the gravest problem of the country", the bulletin has recalled that "the growth of the national income was 22 percent in the second quarter and the increase in employment was only 10 percent, also as a result of the layoff bans" introduced during the pandemic.
According to the bulletin of the Chamber, even though the growth of the industry is indicated as 6 percent on average in the last 10 quarters, the increase in the industrial employment is not even 1 percent.
As noted by the Chamber of Mechanical Engineers, the labor force statistics for July 2021 showed that only one out of the six jobseekers could find a job. While the narrowly defined unemployment rate was 12 percent in July, broad unemployment neared 24 percent and the number was close to 8.5 million people, the bulletin has underlined further.
Indicating that "the Palace regime" cannot tackle the mounting inflation, the bulletin has said that the regime is "trying to write a success story for voters by highlighting the growth rate, whose cake is not worth the candle, and keeping the intended interest rate cut on its agenda to do this."
Concluding the bulletin, the Chamber of Mechanical Engineers has warned that if the interest rate cut is introduced on September 23, the drift to dollar and dollarization will accelerate and lead to significant turbulence, it will bring the inflation to an insurmountable point and cause an escalation in the income distribution and impoverishment. (DŞ/SD)
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