Minister Şimşek Stresses Price Stability as a Prerequisite for Minimum Wage
Minister of Treasury and Finance Mehmet Şimşek recently announced a statement regarding the increase in minimum wage through his social media account. Minister Şimşek emphasized the importance of price stability for a sustainable boost in purchasing power and welfare of employees. The main objective of the program being implemented is to achieve long-term high growth and a fairer income distribution.
Minister Şimşek proudly mentioned that the government has consistently supported employees throughout their term. The employment rate increased by a significant 13.7 million people between 2005 and 2024, equating to an average of over 680 thousand new jobs annually. Since the initiation of the program in June 2023, the employment rate has already risen by 1.4 million.
One striking aspect is that the minimum wage has been increasing at a faster pace than inflation. In 2023, while inflation stood at 64.8 percent, the minimum wage saw an impressive 107.3 percent rise. Looking ahead to 2024, with an inflation expectation of around 45 percent, the minimum wage has increased by 49.1 percent, outpacing the average annual growth rate of 5.3 percent between 2003 and 2024.
The recent data reveals that the share of labor payments in gross value added has hit a record high of 37.6 percent in the third quarter of 2024, marking a significant 6.1 point increase from the previous year. Furthermore, the minimum wage has seen substantial growth over the years, rising from $112 in 2002 to $196 today based on US inflation. Projections indicate that the minimum wage for 2025 could surpass $620 at the current exchange rate, showcasing a 5.6-fold increase from the 2002 level.
It is noteworthy that the current minimum wage level in Turkey now exceeds those in various developing countries such as Romania, Bulgaria, Mexico, China, Brazil, South Africa, Indonesia, Russia, Egypt, and India. Minister Şimşek’s statement reflects the government’s commitment to continuously support and uplift employees, ensuring a more prosperous and equitable future for all.
