EconomicOutlook2014M02 The Positive Outlook in the Last Quarter Reversed
Zümrüt İmamoğlu and Barış Soybilgen
In December, seasonally adjusted Industrial Production Index (IPI) remained constant compared to the previous month. Export volume index decreased by 1.6 percent and import volume index increased by 2.8 percent. December data shows that production was not affected by developments in the second half of December. Industrial production accelerated in the last quarter and exports increased slightly more than imports excluding gold trade. However, deteriorations in expectations and financial indicators are striking.
Following December data, Betam’s forecasts for the last quarter remained same. Our quarter on quarter growth forecast for the last quarter is 0.3 percent, and the corresponding year on year (YoY) forecast is 4.8 percent. Our growth forecast for 2013 is 4.2 percent. The current account deficit increased significantly in December. Betam expects the current account deficit to GDP ratio, which was 7.2 percent at the end of third quarter, to increase to 7.9 percent at the end of the year. We expect gold excluded current account deficit to fall from 6.9 percent in 2012 to 6.5 percent in 2013.
EconomicOutlook2014M01 Economic Outlook Improved in November
EconomicOutlook2013M12 Growth Stagnates in the Last Quarter
EconomicOutlook2013M5 Weak Growth in the First Quarter
EconomicOutlook2013M4 Current Account Deficit Widens as Economy Recovers
UNEMPLOYMENT DECREASED THANKS TO CONSTRUCTION
Seyfettin Gürsel, Gökçe Uysal and Ayşenur Acar
Seasonally adjusted labor market data shows that non-agricultural unemployment rate decreased from 12.5 percent to 12.1 percent (0.4 percentage points) in the period of October 2013 compared to the period of September 2013. This unexpected decline was due to the large increase in non-agricultural employment, most of which was in the construction sector. Seasonally adjusted employment increased by 99 thousand from the period of September 2013 to the period of October 2013. Hence, unemployment rate decreased by 0.5 percentage points. Consequently, seasonally adjusted non-agricultural unemployment rate increased from 11.4 percent in October 2013 to 11.9 percent in September 2013.
Seyfettin Gürsel and Melike Kökkızıl
Inflation calculated by Turkish Statistical Institute (TurkStat) captures inflation faced by a representative household since it covers all income and expenditure groups in Turkey. However, inflation faced by households of different income and expenditure groups may differ since different groups consume different baskets of goods and services. In this research brief, different price indices are calculated for each income quintile from the poorest to richest by using consumption data from the Household Budget Surveys (HBS) released by TurkStat for the period 2003-2013. The results indicate that poorer households considerably face higher inflation rates than richer ones in the last six years. The poorest households (the lowest income quintile) face higher inflation levels since price increases in food are above average increase in prices during this period. While the inflation difference between the top income quintile and the lowest evolved in favor of the poor householdsfrom 2003 to 2006, inflation difference between the poor and the rich has reached 13 percent pointsagainst the poor households by the end of 2013 due to the global food price shocks.
Seyfettin Gürsel, Gökçe Uysal and Ayşenur Acar
According to quarterly labor market statistics released by TurkStat, urban female employment increased by 56 percent (1.5 million) from 2005 to 2012. In parallel, female labor force also has expanded. From 2005 to 2012, urban labor force participation increased by 0.7 percentage points on average per year and after 2008 the increase accelerated and reached 1.3 percentage points per year. In the last four years, the participation rate has risen from 21 to 26 percent. Due to equivalent and simultaneous rises in female labor force and employment, urban female unemployment rate slightly decreased.
Increases in employment, especially in wage employment, is an important improvement in female employment. The analyses by education and age reveal that especially middle-aged and low-educated (less than high school) housewives have entered the labor market. This is a fresh and striking progress. If these increases in female labor force and employment continue, the gap in female labor force participation between Turkey and developed countries will shrink and Turkey will take a big step on its way to economic development.
Seyfettin Gürsel and Mine Durmaz
2012 Report of Programme for International Student Assessment (PISA) has been published in December, 2013. Results reveal that there is a large but insufficient improvement in Turkey’s performance. From 2006 to 2012 Turkey increased its average score in all fields (mathematics, science and reading) from 432 to 462 points. However, this large increase has not been enough to change Turkey’s ranking (third to last) among 34 OECD member countries. The gap between Turkey and OECD average has been diminished gradually in each field, yet student performances are still poor compared to OECD averages.
On the other hand, during the period of 2006-2012, Turkey increased the share of top performers and simultaneously reduced the share of low performers. In parallel, the share of medium performers, who constitute the main part of the future labor force, also increased. Turkey’s large performance increase results from the success of village schools and the success of relatively poor students. In this sense, results show that inequality in education has decreased in Turkey but the level of inequality is still quite higher than that of OECD average.