Turkey: Unemployment rises to 12.7 pct in December

ANKARA

Turkey's unemployment rate was up 1.9 percentage point in December from a year earlier, the Turkish Statistical Institute (TurkStat) announced Wednesday.

The rate of people seeking a job edged up to 12.7 percent in December 2016, a rise of 1.9 percent compared to same month in the previous year, TurkStat said.

Unemployment also saw a 0.6-point increase from the previous month, its eighth consecutive rise since last August.

The number of people in the labor force totaled 30.54 million, an 888,000-person rise, in December 2016 compared with December of the previous year, thus explaining the rising unemployment despite the economy creating 221,000 jobs in the same period.

The number of people employed was 26.67 million, up 221,000 in December 2016 from a year earlier, data showed.

The labor force participation rate was another factor in the report explaining the rise in unemployment despite solid job creation.

The labor force participation rate (LFPR) was 51.6 percent, up 0.7 percentage points or 888,000.

The LFPR for men was 71.5 percent, up 0.5 percent, and the rate for women was 32.2 percent, up 1 percent over the same period in the previous year.

"Several measures were taken to stimulate economic activity. The government recently announced a subsidy that aims to encourage employers to hire additional employees. These steps might help curb the rise in unemployment as of February," said Gokce Celik, a chief economist at QNB Finansbank.

However she warned that the main trend in job creation will be driven by the growth outlook, so unemployment might remain at elevated levels unless economic activity picks up meaningfully.

Echoing Celik's views, Gokhan Ozkan, a research expert at Isik FX, said the unemployment figures show that Turkey has to focus on industrial growth and create new ways to add value on employment while reflecting those developments in its economic growth.

"As 2016 was a tough year for the country’s economy, after the [April 2016 constitutional] referendum, the government concentrating on reforms supporting acceleration of the economy will be a solution to a high level of unemployment," Ozkan said.