UPDATES WITH QUOTES FROM ANALYSTS
By Tuba Sahin
ANKARA (AA) - Unemployment in Turkey dropped 0.7 points to 10.6 percent in August compared to the same month last year, the Turkish Statistical Institute (TurkStat) announced Wednesday.
The number of jobless aged 15 and over fell to 3.4 million, down 89,000 from the same month last year, TurkStat said in a statement.
The figure also showed a 0.1 percentage point drop from the previous month, when unemployment stood at 10.7 percent.
August's employment rate jumped 1.3 percent from the same period last year at 48 percent.
Ziraat Bank’s economist Bora Tamer Yilmaz said Turkey was a worldwide overachiever this year, considering the number of jobs the country generated.
"The number of employed persons rose by 1.36 million to 28.82 million persons in the period of August 2017 compared with the same period in the previous year," TurkStat said.
Underlying the distribution of employment by sector, Yilmaz said the services sector acted as a flagship.
According to TurkStat data, services sector contributed 52.6 percent to employment.
"In manufacturing, services, and construction employment has hit its all-time highs in August," Yilmaz said.
"Tourism has contributed to economic growth this year via job creation. About one-fourth of all services jobs created belongs to tourism."
- Rise in women workforce
Yilmaz said an upbeat global trade volume and better economic activities in Europe along with domestic developments helped the Turkish economy to create new jobs and keep its workforce steady in the manufacturing sector.
The labor force participation rate was up 1.1 percentage point, year-on-year, to 53.7 percent.
Turkstat also said the number of women in the workforce rose 1.2 percentage points from the previous year to 34.3 percent.
"European prospects deem good about coming months. Therefore, we expect that strong external demand will continue propelling domestic manufacturing," Yilmaz said.
Erol Gurcan, an economist at Gedik Investment, said August’s unemployment rate is better than market expectations.
The unemployment rate showed an upward trend after the first half of the year while it had a downward trend at the beginning of 2017, Gurcan said.
He said the latest figure indicated that the government’s employment campaign and recovery in economy had a positive effect on the country’s employment.
“In sum, Turkey’s unemployment rate confirms strong economic activity in the third quarter of 2017,” he added.
KapitalFX Analyst Enver Erkan said the unemployment rate in July and August was expected to be higher due to seasonal effects; however, it declined month-on-month.
Erkan said unemployment rate could reach double-digits in the near future despite an expected strong third-quarter GDP growth outlook.