Elevator pitch
In the first two decades of the 2000s, Turkey has relied on structural change from traditional to modern sectors on the one hand and educational compositional change on the other hand to create formal employment in the modern sector. In 2000 the share of formally employed salaried employees in total employment was less than 40% for men and 30% for women. By 2021, this ration converged to 60% for men and women. Formal employment has increased for both men and women and the gender gap in formal employment declined substantially until 2020. However, relying on structural change and education to improve job quality has likely run its course. Since Covid-19, time-related underemployment has increased from virtually zero to 10% of the labor force and wages are stagnating if not declining.
Key findings
Strengths
The employment rate for women has increased substantially from 22.3% to 37% between 2005 and 2024.
The share of formal and wage employment has increased.
There was an increase in real monthly wages by almost 70% between 2002 and 2018.
The real wage growth was the highest at the bottom of the wage distribution due to increases in the minimum wage.
Wage inequality has declined noticeably over the period.
Weaknesses
The employment rate for less than tertiary educated women is still only 30% in 2024.
For wage workers, the minimum wage is fast becoming the median wage.
Wages declined in real terms between 2020 and 2022.
The job quality in Turkey is among the lowest of all OECD member states.
The wage premium for university graduates has been declining since 2013 due to stagnant wages.
Migrant workers are almost exclusively informally employed.
