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Easing unemployment in March raises eyebrows in Turkey: report

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Turkey’s unemployment rate eased to 13.2 percent in March from 13.6 percent in February, data indicated on Wednesday, but analysts said the figures do not reflect the blow from the coronavirus outbreak, according to Reuters.

The government imposed a three-month ban on layoffs in April to mitigate the impact of the pandemic, and President Recep Tayyip Erdoğan said on Tuesday the government had prepared a comprehensive package to boost employment.

The jobless rate stood at 14.1 percent in the same period last year. The non-agricultural unemployment rate fell to 15 percent from 16.1 percent a year earlier, the Turkish Statistical Institute (TurkStat) said.

Seasonally adjusted, the non-agricultural unemployment rate rose to 15.1 percent from 14.6 percent a month earlier, with the labor force participation rate declining by 1.7 percentage points to 49.0 percent.

Analysts expect the pandemic to tip Turkey’s economy into its second recession in as many years. Unemployment has remained high since mid-2019 even while the economy emerged from a recession brought on by a currency crisis in 2018.

After a cabinet meeting on Tuesday Erdoğan said the government would give “normalization support” to employers who put workers on short working hours or unpaid leave due to the coronavirus.

Bahçeşehir University’s BETAM economic research center said the linkage between economic activity and employment figures had become invalid due to measures such as a ban on layoffs.

“The relatively high correlation between loss of employment and the number of those unemployed has been disrupted,” BETAM said in a note.

It said the biggest reason for the limited rise in the number of those unemployed despite the loss of their jobs was workers too discouraged to look for another job.

Ali Babacan, Turkey’s former economy chief and a new rival to President Erdoğan, this week said there has been political pressure on TurkStat.

“There is a significant difference between the official numbers and what is being experienced in the market,” Babacan said on FOX TV.

Ten regional executives of TurkStat were recently fired by a presidential decree.

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