UPDATE - Turkey's unemployment rate at over 10 percent in May

UPDATES WITH ANALYSTS’ COMMENTS

By Tuba Sahin and Dilara Zengin

ANKARA (AA) - The unemployment rate in Turkey rose by 0.8 points to reach 10.2 percent in May compared with the same month last year, according to the Turkish Statistical Institute (TurkStat) on Tuesday.

The number of jobless people aged 15 and above jumped to 3.2 million in the month, marking an increase of 330,000 from the same month last year, TurkStat said in a statement.

However, May’s figures showed a 0.3 percentage drop from the previous month, when unemployment stood at 10.5 percent.

On a monthly basis, Turkey's unemployment figure showed a steady decrease during the first five consecutive months of 2017.

The unemployment rate started the year at 13 percent in January, which dropped to 12.6 percent in February, 11.7 percent in March and 10.5 percent in April.

May's employment rate slightly increased by 0.2 percentage point to 47.7 percent compared with same period last year.

Labor force participation advanced by 0.5 percentage point year-on-year to 53 percent in the month.

The TurkStat report revealed that the number of women in the workforce rose by 1 percentage point from the previous year to 33.9 percent.

Commenting on the new figure, Ferhat Yukselturk, managing director of Turkey Macro View Consulting, said that they expected further improvement in the employment market for the rest of the year in light of GDP growth rate estimates.

"In 2017, we expect 5.7-percent growth through strong incentives to boost domestic demand as well as a better-than-projected environment in our main trading partners," he added.

He said the number of employed people had jumped by 599,000 in five months, whereas the number of unemployed fell by 124,000 as of May.

This was “on the back of expansionary policy measures, mainly via fiscal tools," Yukselturk noted

The number of seasonally adjusted employed persons increased by 44,000 to 27.9 million compared with the previous month and the seasonally adjusted employment rate stood at 46.7 percent in the month, according to TurkStat.

In the light of seasonally adjusted figures, Yukselturk said the total payroll in Turkey continued to increase in May thanks to robust economic growth, despite a slower pace.

Seasonal adjustment removes the impact of seasonal patterns and provides a clearer view in data to show changes from month to month.

In the same period, the seasonally adjusted unemployment rate remained unchanged and stood at 11.3 percent.

Orkun Godek, vice president of Private Banking Capital Markets Products Sales at DenizBank, said that after the government’s unemployment incentives, a stronger recovery was expected in the labor market; however, figures underperformed against expectations.

“The unemployment rate might decrease in the summer period,” Godek added.