Turkey's job market continued to improve in March with the unemployment rate falling for the second straight month amid a recovery in demand as the expanding economy creates new jobs. The jobless rate edged down to 10.1% in March from February's 10.9%, statistics office TUIK said on June 15. A year ago the unemployment rate stood at 10.6%.

Despite the slight recovery, the jobless rate has remained stubbornly high, staying above the 10% level since the summer of last year. Prospects for a substantial decline in the unemployment this year are not very bright with the economy heading towards a slowdown and the number of Syrian refugees entering Turkey’s labour market continuing to increase. The GDP posted a stronger-than-expected growth of 4.8% in the first quarter of 2016 but expectations are for the growth to weaken in the coming months as heightened security and political risks started to take their toll.

The seasonally adjusted unemployment rate eased to 9.7% in March from 9.9% in February and from 10.1% a year ago. TUIK calculated the number of unemployed at 3.02mn and the labour participation rate at 51.3%, versus 50.4% a year ago. The construction and services sectors made the largest contributions to job creation, but the key industrial sector lagged disappointed. The construction and services added 1mn and 134,000 jobs, respectively, while employment in the industrial sector declined by 13,000 compared to March 2015. The agriculture sector saw 100,000 jobs disappear.

Job creation was weak last year when the economy expanded by 4%. One of the reasons for the stubbornly high unemployment is the entrance of Syrian refugees to Turkey’s labour market. Turkey hosts nearly 3mn refugees from its war-torn southern neighbour. But on the upside, refugees are believed to boost domestic demand, supporting economic growth. Household consumption, which accounted for 71.2% of GDP in current prices, was the main driver of the country's strong first-quarter GDP growth.

Looking forward, there are some risks, especially for the jobs in the tourism industry which has been hit hard by Russia's sanctions, a wave of terrorist attacks and wider geopolitical risks. 

Turkey's Labour Market
	Jul	Aug	Sep	Oct	Nov	Dec	Jan-16	Feb	Mar
Labour force participation rate (%)	52.4	52.1	52.1	51.6	51.2	50.9	50.7	50.8	51.3
Unemployed (mn)	2.97	3.06	3.10	3.15	3.13	3.20	3.29	3.22	3.02
Unemployment Rate (%)	9.8	10.1	10.3	10.5	10.5	10.8	11.1	10.9	10.1
Non-Farm Unemployment Rate (%)	12.0	12.4	12.4	12.6	12.4	12.7	13.0	12.7	11.9
Seasonally-adjusted Unemployment Rate (%)	10.4	10.4	10.4	10.6	10.4	10.3	10.1	9.9	9.7
Seasonally-adjusted Non-Farm Unemployment Rate (%)	12.5	12.5	12.4	12.6	12.3	12.2	12.0	11.8	11.5
Source: statistics institute