Turkey experienced its lowest unemployment rate in a decade in 2023, with figures dropping to 9.4% from 10.4% in 2022, as per official data released by the Turkish Statistical Institute (TurkStat).

According to TurkStat, the number of unemployed individuals decreased by 318,000 to 3.26 million compared to the previous year.

Employment numbers saw a rise, with 31.6 million individuals employed, marking an increase of 880,000 compared to 2022.

The employment rate also saw a positive trend, reaching 48.3%, reflecting a 0.8 percentage point increase from the previous year.

The labor force in 2023 amounted to 34.9 million, resulting in a labor force participation rate of 53.3%.

For the youth population aged 15-24, the unemployment rate was 17.4%, indicating a decrease of 2 percentage points compared to the previous year. This comes shortly after Turkey's central bank increased its key interest rate to control surging inflation.

Last Thursday, the Central Bank of Turkey announced a hike in the policy rate, also known as the one-week repo auction rate, from 45% to 50%. This decision was prompted by February's inflation figures, which exceeded expectations.

The bank stated in a press release that while imports of consumption goods and gold had slowed down, leading to a slight improvement in the current account balance, recent indicators suggest that domestic demand remains robust.

It is worth noting that S&P Global Ratings upgraded Turkey's credit rating outlook last September, citing the effectiveness of Turkish President Recep Tayyip Erdogan's new economic team and their adoption of more conventional policies.

The outlook on the nation's long-term foreign-currency issuer default rating has been changed from negative to stable, with the credit rating affirmed at B, which remains five notches below investment grade.

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