Evaluation Note / Aslı Toksabay Esen

Why the Unease among EU Citizens Over Turkey's Membership?

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Due to the intensification of the impact of the global crisis on Turkey's economy, the capacity to create new employment opportunities has become constrained and significant employment losses have been observed. The unemployment rate, which varied around 10 percent until the third quarter of 2008, rose to 16.1 and 13.6 percent in the first and second quarter of 2009, respectively. Although there appears to be a relative recovery in unemployment in the second quarter, it seems that this stems from the decrease in the number of people seeking a job and a rise in the number of discouraged workers. When examining the employed, it is observed that this deterioration continues. In the first and second quarters of 2009, the number of employed people decreased by 85 thousand and 387 thousand respectively compared to the same periods in 2008. It is important to understand employment dynamics in order to introduce measures to alleviate the unemployment problem. This note examines the employment dynamics in Turkey in the first quarter of 2009 when the effects of the crisis were most visible. It also puts forth the effects of business size and regional differences on employment. The analysis clearly reveals that the crisis leads to an asymmetrical impact, evident from the fact that firms in different regions and with different sizes are affected by the crisis in different periods and magnitudes.