“Increasing the minimum wage could boost domestic demand, increasing household income, and so it would have an effect on tax revenues,” S&P credit analyst Aarti Sakhuja said in an interview with Anadolu Agency.
The Justice and Development Party (AKP), which won enough seats in the Turkish parliament to form a single-party government, promised prior to the Nov.1 election to hike the minimum wage to 1,300 Turkish Liras ($446) per month from the current minimum wage of 1,000 ($343).
Currently, around 5 million people in Turkey are minimum wage workers, while businesses that sign collective bargaining agreements establish “base wage” negotiations according to the level of the minimum wage.
According to Sakhuja, the new government will have the chance to enact further structural reforms, which have been previously outlined in the past and which specifically address increasing economic growth and reducing the current account balance.
“If you look at the prospective reforms, for example, increasing the minimum wage, incentivizing household savings and reforms related to the participation of women in labor market, these all have a supply side effect, thus increasing Turkish economic growth. And, at the same time, such reforms can move the economy away from the dependence on external financing to more organic financing, generating income. If these are indeed implemented, we would see this as a credit positive,” Sakhuja said.
S&P forecasted the country’s GDP will grow just under 3 percent and that government debt will hold around 30 percent of GDP between 2015 and 2018....
Anadolu Agency
hurriyetdailynews.com
9/11/15
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Private firms concerned over minimum wage rise ...
ReplyDeleteThe annual cost of a 30 percent increase in the minimum wage, an election promise by the Justice and Development Party (AKP), will cost the private sector 16 billion Turkish Liras, according to the head of the Istanbul Chamber of Commerce (İTO), as businesses raise concerns over the upcoming hike.
The commission to decide on the minimum wage will convene on Dec. 1, said Former Labor Minister Faruk Çelik on Nov. 11, adding the new government to be founded after the Nov. 1 election that granted single-party rule to the AKP will submit its suggestion of 1,300 liras, or $450, to the commission.
“The minimum wage will be 1,300 liras as of Jan. 1, 2016,” said the former minister, who left the post in August when an interim government was founded.
The business world was largely silent about all parties’ minimum wage pledges before the elections, as most parties offered even higher figures. However, when the promise took a more concrete shape, business organizations started raising concerns..................http://www.hurriyetdailynews.com/private-firms-concerned-over-minimum-wage-rise-.aspx?pageID=238&nID=91015&NewsCatID=344
11/11/15