A 122.5% year on year increase to 1.4mn in the number of people in Turkey who have reported that they’ve lost hope of finding employment points to a stark deterioration in Turkey’s job market caused by existing economic troubles severely exacerbated by the coronavirus (COVID-19) crisis.

The latest official unemployment data, covering October, also showed 4.1mn people ready to work but not yet looking for jobs, marking an 84% y/y increase.

Economist Seyfettin Gursel of Istanbul’s Bahcesehir University was quoted by Bloomberg as saying the numbers were unprecedented. “There is another artificial situation in employment data since the [coronavirus crisis-period] ban on dismissals is masking about two million people who were sent on leave,” he said. “There is a risk that the bulk of them could be dismissed when the ban is lifted.”

The severity of the worsening jobs crisis is starting to pose a big threat to Turkish President Recep Tayyip Erdogan and his ruling Justice and Development Party (AKP).

Pollster Murat Gezici, head of the Gezici Research Center, told Bloomberg: “A large part of the electorate is experiencing economic problems. Economic policies of the AKP party government appear to have received low marks.”

Erdogan ‘held responsible’

A Gezici survey in November showed combined support for the AKP and its ultra-nationalist ally MHP falling to 45.4%. Metropoll found in the same month that a third of respondents held Erdogan responsible for the deteriorating economy.

Unemployment among younger Turks now officially stands at 24.3%. Around four-fifths of those between the 18 and 27 say they don’t support the ruling coalition. That’s up from 76% in 2018 and 70% in 2015, Gezici said. The age group accounts for 16% of the electorate.

“The jobless ones are now defined as ‘home-youth’,” Gezici was further quoted as saying. “They are deeply frustrated as they’re unable to have their voices heard due to pressure and censorship.”

The Erdogan administration was hoping for a V-shaped rebound as the coronavirus crisis eased, but the crisis appears to have redoubled in Turkey in recent months, forcing the authorities to reintroduce weekend and nighttime lockdowns.

Drive for growth braked

The drive for growth, meanwhile, has been braked by Erdogan bowing to market pressure for elevated interest rates to offer some protection to the crisis-stricken Turkish lira and usher in a period in which the central bank can attempt to rebuild FX reserves devastated by a failed effort at protecting the currency.

Turkey’s next parliamentary and presidential elections are scheduled for 2023, but opposition parties, sensing the vulnerability of the Erdogan government in an increasingly crisis-infused atmosphere, are pushing to have them sooner.

The job retention programmes, including the ban on dismissals, have braked the build-up of official unemployment in the formal sector, with the rate edging down in August to October from the previous period to 12.7%, data released by the official statistics office TUIK on December 10 show. But the overall size of the workforce contracted 3.9% from a year ago, and with companies going bankrupt left, right and centre amid the global health emergency, analysts pay little regard to this headline figure.

In October, Turkish labour union DISK noted that while official unemployment in the three months to August stood at 4.23mn, the real figure, when including people covered by the layoff ban and those placed on short weeks, was 9.8mn in a country of 83mn.