Unemployment distress in Southeast

Every year in March, the Turkish Statistics Institute (TurkStat) publishes the aggregate labor market statistics of the previous year. The 2013 statistics were revealed last Thursday.
In fact, these yearly figures do not give any new information about the labor market dynamics since they do not differ from the trends shown by the monthly figures. However, the release of the aggregate statistics reveals the state of regional labor markets. We know that Turkey's 26 regions differ tremendously from each other not only with respect to labor market indicators such as labor force participation, employment and unemployment, etc., but also with respect to the changes occurring in these indicators; while unemployment, for example, may increase at the national level, it may decrease in some regions. Unemployed waiting in front of the Empolment Agencey's bus    The 2013 figures have confirmed this pattern. The average unemployment rate increased moderately from 9.2 to 9.7 percent. The increase in unemployment had already been observed in monthly statistics, and I may add that this increase is perfectly in line with the increase in the labor force participation rate, rising from 50 to 50.8 percent, as well as a rather sizeable increase in employment following a gross domestic product (GDP) growth rate around 4 percent. Nevertheless, the employment increase has not been sufficient to compensate for the labor force increase. This is the brief story of the Turkish labor market over the past year. As for the regions, we have quite different stories. Let me start with the two lowest unemployment rates: The best performer has been Central Anatolia's Karaman and Konya, with an unemployment rate of 4.7 percent. This rate decreased from 6.1 percent in 2012 and, in that regard, has been one of the highest decreases in unemployment thanks to booming employment. The second-best performer is the Aegean region, with cities like Afyon, Kütahya, Manisa and Uşak having an unemployment rate of 5.4 percent, up from 4.4 percent in 2012. These very low rates mean that there are almost no unemployment problems in these regions. The two regions with the highest unemployment rates are in the Southeast, and largely populated by Kurdish people: Batman, Mardin, Siirt and Şırnak with 21.1 percent, and Diyarbakır and Şanlıurfa with 17.5 percent. They have also the lowest labor force participation rates, around 37 percent, due to very low female participation rates. This high unemployment has its origin partly in the heap of Kurdish villagers living in those cities as a result of a so-called “low-intensity war” that has devastated the region during the last two decades. That said, I have a caveat regarding Diyarbakır and Şanlıurfa: Before 2013, unemployment rates were surprisingly very low -- around 7 percent -- in this region; from 2012 to 2013 the rate suddenly jumped to 17.5 percent. This jump was due to a surprising boost in the labor force, which increased by 32 percent, and not to a decrease in employment, which has strongly increased by 16.7 percent. The astonishing jump in the labor force within a year is uncommon and I think that TurkStat had made a measurement error, particularly underestimating the labor force. The third highest unemployment rate is in the İzmir region, with 15.4 percent. This is not a novelty. İzmir is Turkey's third-largest city, and at the same time, it is one of the most modern cities, having been the main port of the European trade route for a long time. However, İzmir has been in a relative decline for decades; it receives a large number of immigrants from the east and southeast, but its economy is unable to create enough jobs because of low economic growth. The situation worsened even more last year since the unemployment rate increased from 14.8 percent to 15.4 percent. In fact, the employment increase of 6.3 percent has been more than satisfying despite the fact that the labor force increased more, to 7.1 percent. Despite the distress in the Southeast, there are some success stories all the same. While unemployment has been increasing nationwide, it decreased in 11 regions out of 26. The most striking decreases occurred in Karaman and Konya, as mentioned above, as well as in Adıyaman, Gaziantep and Kilis. The unemployment rate of this last region, situated on the Syrian frontier, decreased from 11.8 percent to 7.3 percent. This is rather unexpected, since this region, which boomed over the past years thanks to exports to Iraq and Syria, was affected harshly by the Syrian civil war in 2012. It seems that it has recovered quite well from the trauma.