Turkey increases minimum wage by 50 percent for 2022 amid lira crash

653
0

Turkey’s minimum wage will rise 50 percent next year to help offset increased living costs, President Recep Tayyip Erdoğan said Thursday, Bloomberg reported.

The monthly net minimum salary will be 4,250 lira ($275), Erdoğan said during a televised press conference. In 2021 it stood at 2,826 lira, equivalent to $380, at the start of the year but has fallen to $186 with the lira’s 51 percent depreciation.

More than 40 percent of all workers in Turkey earn the minimum wage, according to the country’s Social Security Institution, meaning the hike will ripple broadly through the economy at a time when polls show Erdoğan’s popularity slipping.

“The increase in minimum wage is 50 percent, and that’s the highest rise in the last 50 years,” Erdoğan said. “I believe this shows our determination to not have our workers crushed under price increases.”

“Starting next year, we will abolish both the income and stamp tax on the minimum wage,” he added.

While the rise could mitigate the discontent that’s taken root among struggling working-class families, it could also fuel already high inflation.

Consumer prices climbed to 21.31 percent from the same period in November of last year, including a sharp increase in the cost of food. The lira has lost more than half its value against the dollar this year, driving sharp price rises across the board.

“The inflation that people feel is much higher than the official data suggest, so wage earners have become impoverished,” Yalçın Karatepe, an economics professor at Ankara University, said last week. “They want to be compensated for the loss in purchasing power.”

Liked it? Take a second to support Turkish Minute on Patreon!