Why is the salary increase in Türkiye melting fast?

According to the international group Tasnim news agency, just a few hours before At the beginning of 2024, Turkish President Recep Tayyip Erdoğan ordered the salary floor to increase by 49%.

Not happy! Because, firstly, the inflation of 2023 was much higher than it can be fought with a 50% salary increase. Second, Turkey’s experience in recent years has shown that even a 50% increase in workers’ salaries in order to deal with inflation remains ineffective, and a contradiction called “increasing salaries and reducing purchasing power”, threatens millions of households.

According to economic experts, the announcement of salary increases for workers and employees by the government or unions and trade unions is, in principle, a mandatory option And it is inevitable in order to deal with inflation in weak and unstable economies.

But in practice, this action has tremendous economic consequences and not only does not cure pain, but usually creates new problems. It creates Because the consequent and chain effects of salary increase, on the one hand, increases the cost of production and raises the price of goods and services higher and higher, and secondly, the psychological effects of this decision, makes it difficult in many areas of production and provision of goods. Services in the private sector, the prices should go up without any rules. Getting multiple zeros and troublesome numbers is not new! Why? For a simple reason: inflation and new prices make the purchasing power of a worker who receives a salary equal to 11,402 liras in 2023 greater than a worker who has 17,22 liras in his pocket in 2024. Leave!

Ebrahim Kavechi, one of Turkey’s economic analysts, says in this regard: “As we have seen, the minimum wage has increased from 11,402 liras to 17,002 liras for the new year, and the increase rate is 49.1 percent. recorded that it is a significant figure. But the question is, does the wage increase increase the purchasing power or the inflation?

According to the official statistics, the hunger line has dropped from 10,373 lira to 14,431 lira. The lira reached and experienced an increase of 39.1%. Such a thing means; The money that the government put in the worker’s pocket as an increase in salary, went directly to the pockets of the producers and sellers of basic goods, and practically, nothing happened to increase the purchasing power, and even a decrease in power happened!

That is, after a 34% increase in the minimum wage in mid-2023, we saw inflation increase by 39.1%, even more than the wage increase. The condition of the workers will definitely get worse. Because the government has firmly announced that in 2024, unlike last year, suddenly in the middle of the year, we will not have anything called a salary increase once again! To put it more clearly, since only two or three days have passed since the new year, the situation of the workers has gotten worse and worse, even taking into account the new salary of 17 thousand lira”.

Coffee Chi further wrote: “According to official calculations, inflation in 2024 will be around 36.0 percent. But firstly, such a thing is impossible and the real inflation will be higher than this, and secondly, after the municipal elections (in April next month), inflation will rise again. Clear and official field statistics tell us that general prices in Istanbul had increased by 40.2% in the last 6 months, and of course, in the food group, they even went up to 43%.

What will we see now with the January price increase? Let me tell you right away: the minimum wage melted and lost its effect the day it was announced. It is a strange and bitter contradiction that we increase the number of salaries, but the purchasing power remains low! It may experience a relative pause in January to February, but especially in the second half of the year, the situation will be very, very difficult for people. Moreover, it is not possible to increase production and employment, and unemployment will be our biggest problem, especially until the end of 2024″.

The Central Bank of Turkey, the Ministry of Treasury and Finance and the experts of Erdogan’s economic team, for the inflation of 2024, the number They have predicted between 34 and 36 percent. But independent and non-governmental think tanks and research institutions believe that such a figure is very optimistic and far from the logic of economics. Convenience deceives people and changes all the figures with the lie that raising bank interest will lower inflation. But this is nothing more than a deception. Twice they raised the bank interest significantly, but the inflation not only did not decrease, but increased. The same is the case with statistics, and they are not willing to announce the real statistics of the market floor”. /Image/1402/10/12/1402101216000738229113964.jpg”/>

Iris Siber, another Turkish economist, also believes that the statistics of the NGO “Istanbul Chamber of Commerce” are far more correct and It is more transparent than government statistics.

He says: The real inflation rate according to the statistics center of the Istanbul Chamber of Commerce ITO in 2023 was announced as 74.88%. That is, slightly less than 75 percent. But in the government statistics, in the most daring conditions, they write between 55 and 65 percent. But economic problems cannot be solved by manipulating figures, and most wage earners will collectively be below the hunger line in less than 5 months. The annual inflation announced by the State Statistics Organization does not correspond to the objective conditions of the country and it is very easy to prove the inaccuracy of these statistics”.

Turkey is on the first rung of inflation in Europe

But Agh Baba, the representative of the people of Malatya in the Turkish Parliament and the deputy leader of the People’s Republic Party, meanwhile Referring to the difficult living conditions of the weaker sections of society, including retirees, he said: “The government has done something that has practically sentenced our retirees to starvation. Unfortunately, in 2023, we still stand on the first step of inflation among all European countries, and we are also one of the first 5 countries in the inflation Champions League in the world! Even assuming the correctness of the government statistics, the increase in food prices in the first 11 months of the year we spent was 64%. Due to high inflation, the purchasing power of workers is constantly decreasing, and the minimum wage in our country is very small compared to all the countries of the world and is below the hunger line”.

Baba further challenged the policies of Erdoğan and the ruling party and said: “Only in one or two months before the elections, they talk about the people and livelihood, and after that, they forget everything.”

The Confederation of Turkish Trade Unions (Türk-İş) in a report announced the results of research on the poverty and hunger line in December and showed that the monthly food cost of a family of four living in Ankara to have a A balanced and sufficient diet is 14 thousand 431 liras to eliminate hunger.

Poverty line, which includes food expenses and other mandatory monthly expenses for clothing, housing (rent, electricity, water, fuel), transportation, education, health and similar needs can reach 47 thousand and 9 liras, and such a thing is equivalent to the salaries of 3 people! It increased.

The cost of living for a single employee reached 18,796 liras per month. According to Türk-İş data, food inflation in Turkey is calculated based on twelve-month averages of 82.21%.

In the end, it should be said that the fiery speeches of the election campaigns of Erdogan and the Justice Party And the development for the upcoming elections has not started yet, but it is already clear that the ruling party does not have a specific plan to improve Turkey’s economic situation, and it is highly likely that the foundation of work will be based on security and polarization.

end of message/