Labor Force Demographics

September 13, 2020, Ayse İmrohoroğlu and Samed Küçükikiz with thanks to Gönül Sengül

In our previous post we discussed how the official unemployment and employment rates are likely to be biased during the COVID-19 pandemic. The biases arise due to measures such as the short-time work allowance, where the government provided additional income support to compensate for the wage loss due to reduced hours by firms to a large number of workers. So, workers who were practically unemployed showed up as employed in official statistics. With this caveat in mind, we want to go back to the official numbers to examine the differences in the labor force experiences of different groups in the economy. All the data are from TURKSTAT.

In the following graphs we show monthly employment data for 2018, 2019, and 2020 in three different sectors. Given the complications with seasonal adjustment methods during unusal years like 2020 we are showing not seasonally adjusted data. After what seems to be a good start in January 2020, especially in the service and industrial (mining+manufacturing+electricity, gas) sectors, large declines in employment took place with the start of COVID-19. By June 2020, the number of people employed in all three sectors remain below their 2019 levels, a recession year, as well as their 2018 levels. 

The following two graphs display year over year changes in employment by gender. Female employment, which was growing at higher rates than male employment since 2015, shrunk by about 8.7% between June 2019 and June 2020. Male employment growth in the same period was -6.1%. Most of the differences between male and female workers during this period were due to the agricultural sector. In the non-agricultural sector, declines in male and female employment were similar, 7.6% and 6.7% respectively.

Young workers (ages 15-24) meanwhile suffered larger losses, with a 17.4% decline in employment between June 2019 and June 2020 as opposed to the 5.2% decline for those over 24.

Changes in employment during the pandemic differed substantially across different education groups. In the following graph the horizontal axis shows 4 different education levels: Illiterate; less than high school; high school+vocational high school; and more than high school. By June 2020 (compared to June 2019), the decline in employment was larger in lower education categories. 

In June 2020 (relative to June 2019), the number of employed people with higher than high school education actually increased. This increase was larger for women (4.2%) compared to men (2.7%).  However, in the lower education categories (less than HS and HS) female employment declined more than male employment. For example, for those with only a high school degree, female employment declined by 10.8% while male employment declined by 4.5%. In the lowest education category male employment declined by 29% and female employment by 21%.

Meanwhile, many workers responded to the labor market conditions by withdrawing from the labor force. In January 2019, there were 61 million working age people (+15 years old) in Turkey. Of this total about 31.8 million were in the labor force and 29.2 million not in the labor force. By June 2020, number of people not in the labor force had increased to about 31.9 million. There is a variety of reasons for not participating in the labor force where the largest two categories are housework (housewife – 10.1 million) and education (4.4 million). Another important category is the number of individuals not looking for work but available to start (discouraged+other), which was 2.3 million people in 2019. By June 2020, the number of people in this category had increased to 4.6 million. Below graph shows the increase in the number individuals in this category during the 2018-2019 recession (October 2018- June 2019) and during the COVID-19 pandemic (March 2020-June 2020).

We would like to conclude with the time series path of employment by gender in different education categories over the years. Some observations are worth summarizing:

  • Between 2014 and 2019 the number of employed individuals in the illiterate category declined by 184 thousand people. Majority of the decline was due to the decline in the number of illiterate female workers.  
  • During the same period, employment of those with more than a high school degree increased by 2.0 million (from 5,085,000 to 7,104,000). The increase was more or less equally distributed between men and women (1.1 million men and 915 thousand women).
  • Except for the illiterate category, the employment gap between men and women remained almost the same over these years.
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