LABOR MARKET:
PARTICIPATION,
EMPLOYMENT, UNEMPLOYMENT,
UNIONIZATION
ZEYNEP AYDIN
IŞIK EMEL ÇELEBİ
ÇiSE ŞENTÜRK
Key Definitions:
1. Non-institutional population: The population besides people residing in
university dorms, orphanages, nursing home, private hospitals,
prisons, barracks etc.
2. Labor Force = Number of Employed + Number of Unemployed
3. Labor Force Participation Rate = (Labor Force / Total Population over
Age 15) * 100
4. Unemployment Rate = (Number of Unemployed / Labor Force) * 100
5. Employment Rate = (Number of Employed / Labor Force) * 100
6. Informal Employment: Workers who are not registered to any of the
social security institutions in the reference period
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Further Definition of Labor Force
Who is included in Labor Force
Who is not
Farmers who only produce to satisfy their
family’s needs (if the amount of agricultural
production has an important share in the
household consumption)
People who do not work because of familyrelated or personal reasons
Retired people (if they still work)
Retired people (if they do not work)
Apprentice (çırak) and interns
People who are doing household chores
People who have additional jobs or tutoring
(if they are registered)
People participating in non-formal education
Paid workers in volunteer organizations
Disabled, old or ill people
Workers in paid leave (e.g. maternity/paternity
leave)
Discouraged workers
Seasonal workers
People who work in volunteer organizations
(without getting paid)
People who work without any social insurance
(informal/shadow employment)
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Employment & Unemployment
Employed
Unemployed
Who;
-is engaged in any economic activity
-during the reference period for at least 1 hour
-as a regular employee, casual employee,
employer, self employed or unpaid family worker
Who;
-has not a job
-is seeking a job
-made an attempt into it in passed three months
-is able to start working in two weeks if he/she
finds a job in the reference period
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Employment (early Republic)
1- A significant amount of qualified manpower was either destroyed in
incessant wars or migrated (Greeks and Armenians).
2- Remaining manpower was inexperienced in business and trade, since
the qualified Turkish manpower generally consists of officers in
government services.
3- The country had a very shaky financial system which had lost its main
source of revenue by the abolition of Aşar.
4- The capital accumulation in the country was very inadequate and there
were severe problems of savings and foreign exchange gaps.
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Source: TURKSTAT
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7
Sectoral Share of Employment
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Sectoral Share of Employment
Source: TURKSTAT
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Common Reasons of Unemployment:
1- Lost job:
• worked temporarily
• was dismissed
• business got liquidated or went bankrupt
2- Quit the job:
• due to insufficient income
• due to unsatisfying working conditions
• retired
3- First time job seeker (or newcomer):
• just graduated
• just completed his military service
• other
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Unemployed according to their
education level (in thousands)
Source: TURKSTAT
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Unemployment Rate by Cities (2013)
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Labor Force Participation Rates
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Three patterns emerge from this figure:
• Rural LFPRs are higher than urban LFPRs
• Male LFPRs are higher than female LFPRs
• The male-female differential is higher in urban areas than in rural
areas.
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Minimum wage by years
Source: http://www.csgb.gov.tr/en/contents/istatistikler/asgariucret/
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Minimum Wage (cont’d)
• How does the minimum wage affect informal sector?
• Payroll tax burden on workers?
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• Averages in both the public and private sectors rose sharply during the
1989-91 period with the return of populist policies.
• Public sector workers experienced additional real wage increases in
1992 and 1993.
• The gains were severely eroded in 1994 and 1995, as wages fell
sharply following the economic crisis in 1994.
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Unionization
FACTS:
Unionization rate or unionization density = The ratio of wage and salary
earners that are trade union members, divided by the total number of wage
and salary earners (OECD Labour Force Statistics).
Unionization is higher;
• in public sector than private sector
• in bigger instutitions than smaller ones
• in industry rather than service sector
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Chronological background
There was no need for unionization in the early time of the republic (19231946) because;
• Population was low and land area was large due to wars
• Greek and Armenian population, which constitute most of skilled labor
in Ottoman, migrated.
• Skilled labor could easily set their own jobs or become landowner
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• 1947 -> the first law of unions was approved: the law about Unions of
Employees and Employers.
• 31 June 1952 -> TURK-IS was established.
• 1955 -> TURK-IS was closed down
• 1961 Constitution:
– The right to unionize is granted to the officers
– The right of strike is granted to the workers
• 1963 -> The Unions Law, Collective Labor Agreement and The
Lockout Law
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• 1961-1980: GDP increased, public institutions & industrialization
=> the need for unionization increased
• Political Segregation of Unions: DISK (1967), MISK (1970), HAKIS (1976)
• 1971 Military Intervention: the officers’ unionization halted
• 24th January Decisions: 25th January - 6414 workers on strike ->
27th June - over 57.000 -> 5th September - 53.644
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• After 12 September 1980:
– Many rights and freedoms in the constitution and collective labor
agreements were dismissed. (Legal)
– The unions were systematically oppressed.
– Incentives to unorganized state (deunionization)
– Social state ideology and implementations were demolished.
– No strike and lockout practised in the years 1980,1981 and 1983
under the prohibition put into force.
• 1989-1994: Compensation of the losses in real wages with signed
collective labor agreements by TURK-IS member unions.
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Structural
Legal
Political
1946-1963
● Based on agricultural
economics (no need
for unionization
● Not enough number
of dependent worker
● Not including white
collar worker into
definition of worker
● Ban of politics for unions
● Not providing
pluralistic
democracy
● Not giving the right
of strike
1963-1983
● Still based on
agricultural
economics
● Little improvement of
industrialization
● The laws of collective
agreements, strike and
lockout
● Rights of unionization
for everyone who works
in return for wage
● The most suitable
era, the 1962
Constitution which
guarantees the
fundamental rights
and freedom
● After 70’s, suitable
situations turn
reverse
1983- …
● Informal economy
● Unemployment
● Not giving the rights of
unionization for all
workers
● Not enough job security
● Privatization politics
● Deunionization politics
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Source: OECD-Stat
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Confederations in Turkey
•
•
•
•
•
•
•
•
BASK
DİSK
HAK-İŞ
KAMU-SEN
KESK
MEMUR-SEN
TİSK
TÜRK-İŞ
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Summary
Labor market of Turkey is characterized by:
• low employment,
• high unemployment,
• increasing labor force participation rate,
• increasing min wage and
• decreasing unionization rate.
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Employment - Unemployment Rate
Labor Force Participation Rate
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Source: Bloomberg
References:
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www.tuik.gov.tr
www.csgb.gov.tr
BULUTAY, Tuncer, Employment, Unemployment and Wages in Turkey, International Labor
Offices, Ankara,1995.
KAMU İSTİHDAM BÜLTENİ - DİSK
KOÇ, Yıldırım, Sendikacılık Tarihi, Türk-İş Eğitim Yay. No.1, Ankara,1998.
MAHİROĞULLARI, Adnan, Türkiye’de Sendikalaşma Evreleri ve Sendikalaşmayı Etkileyen
Unsurlar, C.Ü. İktisadi ve İdari Bilimler Dergisi, Cilt 2, Sayı 1.
TUNALI, İnsan, Background Study on Labour Market and Employment in TURKEY
Employment Outlook 2015, OECD, 2015
Turkey Labor Market Study, World Bank, 2006.
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