After a 95% increase in the minimum wage in 2022, what will be the amount of the minimum wage in Turkey in 2023? To answer this question, a second day of consultation will take place this Wednesday, after a first round table between representatives of the State, employers and employees which took place on Wednesday 7 December. From 2,825 Turkish liras in 2021, the monthly net minimum wage in Turkey rose to 4,253 liras in January 2022, then 5,500 liras in the second half of this year, or around 280 euros.
With these successive increases, the minimum wage in Turkey runs after the inflation that hits Turkish households. The rise in prices indeed peaked in October, with 85% annual inflation according to the Turkish Statistical Institute, or even 185% according to independent economists from the Inflation Research Group (ENAG). In November, these figures fell to 84% and 170% respectively.
The Istanbul Chamber of Commerce estimates the price increase over one year at 105% in the economic capital of Turkey. Inflation largely imported, and caused by the depreciation of the Turkish national currency which fell by 44% against the dollar in 2021 and has lost another 29% of its value against the greenback since the beginning of the year.
According to the Turkish Central Bank, 43% of employees (excluding the agricultural sector) are paid the minimum wage in Turkey. A rate that rises to 50% in the industry. These workers are represented in negotiations on raising the minimum wage in Turkey by TÜRK-İS, the country’s main trade union confederation. The organization defends a revaluation of at least 41% to reach 7,785 Turkish liras (395 euros) monthly net and warns that it will not fall below this ‘red line’.
TÜRK-İS is however not the most demanding union. The DISK, Confederation of Revolutionary Workers’ Unions, demands a minimum wage of 13,200 pounds and its revaluation every quarter according to inflation, while the Republican People’s Party (CHP), the main opposition party, puts forward the figure of 10,000 pounds.
A few months before a presidential election for which Recep Tayyip Erdogan is putting his mandate back on the line, the revaluation of the minimum wage should be substantial. “The decisions taken by the government in the economic field are closely linked to the electoral calendar”, assures the economist Mustafa Sönmez, “President Erdogan will obviously make sure to appease the discontent of the voters so that it does not express itself not politically at the ballot box. It is this electoral objective that will dictate the increase in the minimum wage in Turkey and not economic considerations. But whatever the new amount of the minimum wage in Turkey, it will not compensate for the loss of purchasing power accumulated for months by employees. »
The possibility of an increase that would bring the minimum wage in Turkey above 500 dollars per month (about 10,000 Turkish liras) worries certain sectors of Turkish employers. Mustafa Gültepe, President of the Assembly of Turkish Exporters, says he fears “losing a lot of competitiveness”. As for the risk of seeing the increase in the minimum wage stimulate a wage-price spiral, it is ruled out by the Governor of the Central Bank of Turkey Sahap Kavcıoglu: “We do not think that the increase in the minimum wage will have much effect on inflation. »
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