Seyfettin Gürsel, Gökçe Uysal, Mehmet Cem Şahin
As the Covid-19 pandemic made a disastrous impact all over the world, the social distancing measures taken to decelerate the transmission of the virus, affected all the economic activities directly or indirectly. The effects of these measures varied in magnitude across multiple dimensions. We aim to investigate these asymmetric effects in a series of research briefs. In this first brief, we will focus on how the distancing measures affected employment across the formal-informal divide, an existing structural problem of the Turkish labor market.
Both the distancing measures to fight the pandemic and the economic stimulus packages that protected only the formally employed individuals, affected informally employed individuals disproportionately. As a result, employment losses among this group have yet to be recovered. Among the formally employed, the employment losses among the salaried workers were largely offset by the employment gains realized in the second half of 2020, while the employment gains of the non-salaried workers (own account workers, employers and unpaid family workers) surpassed the employment losses that occurred after the period of January 2020. As for the informally employed, the substantial employment losses could still not be recovered. In general, while a portion of the employment losses from February 2020 through May 2020 could be recuperated in the summer of 2020, the employment losses started again in autumn. Though due to different underlying reasons, similar patterns were also observed among the salaried and the non-salaried informal workers.