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The Jobs Challenge in Turkey: Putting More Human Capital to Use and Making It More Productive

May 27, 2013

ANKARA, May 27, 2013— The Ministry of Development and the World Bank launched today a new joint report on “Managing Labor Markets through the Economic Cycle”. This new study looks at labor market performance during the 2008-2009 crisis and subsequent recovery and analyses recent outcomes in the context of Turkey's long-term challenge to create sufficient high productivity jobs for its young population.

The report highlights the remarkable recovery in Turkey's labor market after the 2008-2009 crisis, with current unemployment rates down on pre-crisis levels in contrast to many peers in Europe and among emerging markets. In particular, the strong growth in female employment after the crisis is noteworthy. The report analyzes policy measures taken during the crisis, such as the targeted reduction in payroll taxes for women and youth, and compares Turkey's labor market policies and institutions with international peers to distill lessons of experience in managing labor markets during the economy cycle. It also puts Turkey's remarkable employment recovery into the context of the country's long term challenge to create more high productivity jobs, as Turkey's working age population will continue to grow for several more decades and current employment rates, particularly among women and youth remain historically and comparatively low.

Martin Raiser, Country Director of the World Bank commented on the findings of the Report: "Turkey's labor market recovery is remarkable and worthy of further investigation. Turkey's strong economic performance is followed with interest in many countries, but the labor market remains a structural weakness with low employment rates and many low productivity jobs. If Turkey manages to maintain the recent pace of job creation and move progressively into higher value added activities, it will reap enormous gains from the demographic dividend of a still young and growing population. The World Bank is pleased to partner with the Ministry of Development to understand better the causes of the recent upturn and draw appropriate lessons for policy in Turkey and for other young, emerging markets.

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