BY ALAATTIN AKTAS
The share of compensation of employees in the Gross Value Added (GVA) THE was down from 30.1% to 26.5% in 2022, compared to the previous year, according to the Turkish Statistical Institute (TurkStat).
The share of compensation of employees in the GVA has never been as low as 2022 over the past 25 years.
Quarterly, the last year broke this negativity record besides the first quarter.
The share of compensation of employees in the GVA hit an all-time low in 2001 quarterly. The lowest shares in the second, third, and fourth quarters emerged in 2022.
2022 has already been the worst year on an annual basis. Of course, the level of per capita income is an important indicator in terms of comparison between the countries. But it’s not important for the per capita income to be high alone. How?
I talked with Professor Fatih Ozatay after TurkStat announced the gross domestic product (GDP) for the last year. He gave a good example of this issue.
“Low-income people sit in a village coffee house. All of them are low-income and close to each other. Their average income will suddenly increase when a millionaire enters that coffee house. Does this hike in the average mean anything for people besides that millionaire?”
Our situation is somewhat similar. The GDP per capita exceeded USD 10,000 last year after a long time. We should be happy with that. But has this income hike been well distributed?
On the contrary. The average GDP per capita increased while the compensation of employees in the GVA hit a historic low.
Moreover, the surge in the GDP per capita can’t be counted realistic that much. On one hand, inflation rapidly increased, on the other hand, inflation rose at a much lower level by pressuring the foreign exchange rates. This has paved the way for the GDP per capita increase. That’s why there is no real hike in the GDP per capita. After all, what does it matter if this increase wasn’t distributed equally?
After all, what does it matter if this increase is not distributed evenly? In the meantime, the Istanbul Wage Earners Cost of Living Index (WECLI), which indicates the movement of retail prices in Istanbul, increased by 3.83% in February, compared to the previous month, according to the Istanbul Chamber of Commerce (ITO). The 2-month hike reached 10%.
The surge in the consumer price index (CPI) hit 6.65% in January and 3.15% in February, according to TurkStat.
TurkStat said the field prices couldn’t be complied for the February inflation data in the Gaziantep, Malatya, and Hatay Regional Directorates of TurkStat due to the twin quakes on February 6.