Turkish gov’t ‘to help employers to curb minimum wage raise’: minister

ISTANBUL

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The government has planned to help employers in facilitating the planned minimum wage raise, said the Science, Industry and Technology Minister Fikri Işık in a televised interview. 

“We have made a detailed analysis about the minimum wage in Turkey. More than 3.4 million people were working in the manufacturing sector as of the end of 2014. Some 969,700 of them earn minimum wages…constituting around 28 percent of all employees in the manufacturing sector,” he said. He added that if the sector undertook the whole burden of the planned raise, their pre-tax profitability would not have declined from 4.5 percent to 3.5 percent. 

“A maximum decrease of 20 percent in pre-tax profitability may be seen,” he said in an interview on Bloomberg HT. 

Işık said the government will try to support employers by taking some of the burden resulting from the planned minimum wage raise, especially in the sectors that have difficulty in competitiveness. 

The minimum wage is expected to rise from 1,000 Turkish Liras to 1,300 liras by the beginning of next year.

Business leaders have warned the government that layoffs could begin and some facilities would be forced to be closed if the conditions are not eased.

There are around 12 million employees in Turkey and some 5 million of them are paid minimum wage, at least on paper. However, some companies illegally show wages as lower in order to avoid higher fees.

The annual growth in real wages has averaged 5 percent over the last five years, while labor productivity increased by 1.5 percent a year during the same period, state statistical data shows.