Work Sharing during the Great Recession

Work Sharing during the Great Recession

New Developments and Beyond

Edited by Jon C. Messenger and Naj Ghosheh

‘Work sharing’ is a labour market instrument devised to distribute a reduced volume of work to the same (or similar) number of workers over a diminished period of working time in order to avoid redundancies. This fascinating and timely study presents the concept and history of work sharing and explores the complexities and trade-offs involved in its use as both a strategy for preserving jobs and a policy for increasing employment.

Chapter 5: The Turkish experience with work-sharing policy during the global economic crisis, 2008–2010

Erinç Yeldan

Subjects: economics and finance, labour economics, public sector economics, social policy and sociology, labour policy

Extract

In terms of employment vulnerability, Turkey was hard hit by the global financial crisis that began in 2007. The repercussions of the crisis began to be felt by the third quarter of 2008 when the gross domestic product (GDP) decelerated to 0.9 per cent in real terms (annualized). With a further contraction of 7 per cent in the last quarter of 2008, and a historical collapse by 14.9 per cent in the first quarter of 2009, the Turkish labour market faced a severe contraction in demand. The open unemployment ratio increased by almost six percentage points from an average of 9.5 per cent during the summer months of 2008 to a historical high of 16.1 per cent in February 2009. Industrial production felt the burden of adjustment severely as it dropped by 24 per cent in January 2009, and may have reached the pre-crisis levels only by July 2010. In response to the darkening economic conditions, the Turkish government enacted a series of stimulus packages starting in the last quarter of 2008. The first employment package was announced in October 2008, with mostly provisions for reductions in social security premiums and other cost items for the employers.

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