Turkey's unemployment rate declined further to 11.7% in March, the lowest level posted since last October, the country's statistics office, TUIK, reported on June 15.
The joblessness rate of 13% registered in January was the highest recorded since February 2010 when it stood at 13.5%. Despite the slight recovery seen over the next two months, the March 2017 figure was nevertheless far higher than the 10.1% recorded for March 2016.
Recent data suggests that Turkey's economic growth performance is still weak despite the recovery reported over Q4 last year and Q1 this year from the Q3 2016 contraction of 1.3%. Not enough jobs are being generated.
Dwindling numbers of tourist arrivals as well as political and security concerns in the wake of the coup attempt in July last year and terrorist attacks have hampered the economy’s performance.
Prior to the April 16 referendum that narrowly voted to introduce an executive presidency, the government argued that the economic outlook would improve and that investor confidence would be restored as political uncertainties would diminish. It has promised to carry out much-needed but long-delayed structural reforms that should focus on the economy’s weak spots such as inflation, the current account deficit and unemployment.
TUIK reported earlier this month that the Turkish economy grew 5% y/y in Q1, picking up from the 3.5% rebound seen in the previous quarter after the 1.3% slump experienced in the third quarter of 2016. However, markets are sceptical when it comes to TUIK’s growth figures.
The month on month change in the number of unemployed people also showed a recovery, falling to 3.64mn in March from 3.90mn in February. The seasonally adjusted unemployment rate declined for the third consecutive month to 11.5% in March, the lowest figure recorded since October.
The labour force participation rate was 52.2% in March, up from 51.8% in the previous month.
The rate for youth unemployment declined to 21.4% in March from 23.3% in February. Youth unemployment stood at 17% in March 2016.
Turkey's unemployment rate rose to 10.9% in 2016 from 10.3% in 2015.
The IMF projects that the Turkish unemployment rate will pick up to 11.5% in 2017 while it expects GDP growth of 2.5%.
The latest consumer confidence survey by TUIK showed on May 18 that Turkish consumers expect the unemployment rate to decline as they believe the general economic outlook will brighten over the next 12 months.