Cablegate: Labor Ministry On Unemployment in Turkey

This record is a partial extract of the original cable. The full text of the original cable is not available.

161449Z May 05

UNCLAS SECTION 01 OF 02 ANKARA 002784

SIPDIS

DRL/IL PLEASE PASS TO DOL/ILAB BILL BRUMFIELD

E.O. 12958: N/A
TAGS: PGOV ECON ELAB SOCI TU
SUBJECT: LABOR MINISTRY ON UNEMPLOYMENT IN TURKEY

REF: ANKARA 2737

1. (U) Summary. The Labor Ministry's ISKUR, the Turkish
Employment Organization, an agency charged with developing
and enacting employment policies, is trying to match jobs
with workers at the micro level to alleviate Turkey's
official 11.5 percent unemployment rate, which may understate
the severity of the unemployment problem in Turkey. End
summary.

2. (U) ISKUR, a Ministry of Labor and Social Security
directorate charged with addressing all issues related to
unemployment, was established in 1946. ISKUR has 2000
employees to handle unemployment issues for Turkey's
population of 70 million. It provides vocational counseling,
supports employment services, advises on legislation, and
works with Parliament's Family, Health and Labor Committee
and the State Economic Enterprises Committee. However,
ISKUR's inability to match jobs with job-seekers meant that
as recently as December 2004 there was a back log of
2,216,000 people seeking and not finding employment -- 13.6
percent of whom were university graduates.

3. (U) As noted in reftel, the official unemployment figure
published by the Turkish State Statistics Institute, which
indicated Turkish unemployment was at 11.5 percent in January
2005, may understate the severity of the problem.
Concurrently 13.1 percent (3,189,000 people) were working
part-time because full-time employment was not available.
One Embassy contact, economist and polling company owner
Tarhan Erdem, suggests the real unemployment rate may be
closer to 12 million, or approximately one-quarter of the
work force. Most economists do not believe the official
statistics are that far off. As noted reftel, unemployment
data are difficult to capture with accuracy in Turkey because
of high unemployment and the large unregistered economy.

4. (U) ISKUR Acting Director General Namik Ata told us that
700,000 people enter the labor market each year in Turkey,
particularly in the services sector, which is currently
providing more job opportunities than other sectors. Ata and
other contacts note that the actual number of jobs in Turkey
is actually increasing, but this improvement in the country's
unemployment rate is not evident because worker productivity
is increasing with improved technology and the labor force is
growing faster than the number of jobs. Ata also speculated
that another reason unemployment has increased is because the
state is no longer creating new jobs.

5. (U) ISKUR's primary mandate is to find employment for
workers. It provides programs to improve workers'
professional qualifications, albeit at a minimal level. Ata
states Iskur received an EU grant of 32 million euros to
provide training to the unemployed or to people at risk of
losing their jobs. For example, in Istanbul, ISKUR worked
with the Hak-Is Union and the Kagitname Municipality to train
kapicis (building doormen-superintendants) at risk of losing
their jobs because their apartment buildings were switching
from coal to labor-saving gas heat. ISKUR has also retrained
textile workers in anticipation of their possibly losing jobs
as a result of competition from cheaper Chinese imports.
Ata, stating that a basic problem of the workplace is that it
does not provide training for the workforce, is a proponent
of a new trend in the Ministry of Labor to encourage Turks to
pursue lifelong learning.

6. (U) Private employment offices opened in 2004 in an
attempt to alleviate the unemployment problem, but appear not
to have been very successful. For example, Enver Celikbas,
head of Kariyerim Private Employment Bureau in Ankara, could
only find six jobs for 2400 applicants in the past year.
Applicants who were offered jobs have turned them down saying
the wages were too low. Nevertheless, after an April 19 mine
explosion in Kutahya, unemployed youths waited in line to
compete for the jobs of the 18 mine workers killed as a
result of alleged safety violations.

7. (U) Labor Minister Murat Basesgioglu confirms the GOT
plans to unveil a "National Employment Plan" by the end of
2005. Economy Minister Babacan has also claimed recently
that the Government will now focus on employment issues. As
part of this effort, Ata is preparing a joint assessment
document with the EU and will also develop an action plan to
expand employment opportunities. Further, TISK (employers
syndicate) President Tugrul Kudatgobilik worried that
unemployment had reached serious proportions and if not
addressed could result in 20 percent unemployment (of an
increasing larger population base) by 2010.

8. (U) Comment: Many Turkish officials point to
under/unemployment as a serious problem, but there are no
easy solutions given the combination of high employment
taxes, productivity increases, and a fast-growing labor
force. Efforts such as those of ISKUR and the private
employment offices to find jobs will have little effect until
the economics of job-creation improve. Prime Minister
Erdogan's AKP government promised voters significant
improvement in Turkey's employment situation within three
years of being elected. AKP's three years come due November
2005; AKP parliamentarians admit there is still little
improvement and ordinary Turks overwhelmingly say
unemployment is their number one political issue. As time
passes, the AKP government will be more tempted to use
populist, budget-breaking measures to try to solve the
problem, which can be expected to create tension with the
IMF. End comment.
EDELMAN

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