When the coronavirus pandemic hit Turkey last year, the government stepped in to support workers by deploying several schemes, including a wage support program for employees of companies that have been hit by the outbreak. The scheme is set to end Wednesday.
At its peak, over 3 million people were receiving two-thirds of their salary under the short-term work allowance and 1.3 million continued to do so.
But the scheme now ending has prompted calls for its extension. The government on Monday said it would reinstate measures and tighten restrictions on movement and gatherings because of rising infections, less than a month after easing them.
President Recep Tayyip Erdoğan announced the tightening, including the return of full nationwide weekend lockdowns over the Muslim holy month of Ramadan, which will start on April 13 and end on May 13.
Restaurants and cafes were allowed to reopen in early March as Turkey started easing coronavirus restrictions, but daily COVID-19 cases have soared since then, prompting the government to restore the 48-hour lockdown on weekends.
Cafes and restaurants will operate at half-capacity until Ramadan begins and will shift to delivery and take-outs throughout the month.
Authorities hope Turkey’s relatively swift vaccination program will help contain further surges.
The country has until now been using COVID-19 vaccines developed by China’s Sinovac Biotech Ltd. and has carried out over 15.67 million inoculations, with 8.88 million people having received the first dose since Jan. 14 when the nationwide rollout began.
In the meantime, Erdoğan has announced additional support for restaurants and their staff during the month of Ramadan.
The government says it will also direct funds from the short labor payments to support employment, covering social security payments for some private-sector employees and effectively decreasing personnel expenses.
But some employers say those moves may not be sufficient.
Özgür Burak Akkol, head of the Turkish Confederation of Employer Associations (TISK), said that the extension of the short-work allowance scheme until the economic and social conditions fully improve is important for the protection of employment.
Under the allowance, the government has been paying 60% of staff salaries. Around TL 32 billion ($3.8 billion) has been extended for some 3.7 million employees under the scheme since March 2020, including TL 27 billion throughout last year and TL 5 billion in the first two months of this year.
Turkish Tradesman and Craftsman (TESK) Chairperson Bendevi Palandöken said the scheme should be extended until the end of the year.
“The short-term work allowance is due to end by the end of March, but our trades will not recover in a few months. For this reason, both cash wage support and short-term work allowance should be extended until the end of the year,” Palandöken said in a statement.
Ramazan Bingöl, head of the Association of All Restaurants and Suppliers (TÜRES), said businesses in the sector may have to furlough 300,000 employees just as the summer high season starts unless the income support is extended.
“We are still closing down our restaurants due to the restrictions – at a time when we would be making the most money,” Bingöl told Reuters Wednesday, adding that businesses had urged the government to extend the short labor pay scheme.
Other representatives, including Ankara Chamber of Commerce (ATO) Chairperson Gürsel Baran and Ankara Chamber of Industry (ASO) Nurettin Özdebir, have also called for the scheme to be extended.
The ban on layoffs, a measure that kept unemployment down throughout 2020, has been extended through mid-May. The country has also extended cash assistance to its citizens. It had been extending TL 1,000 to the families in need.
With the ban in place, employers say hundreds of thousands of workers could be put on unpaid leave because businesses are still struggling.
Turkey’s unemployment rate fell to 12.2% in January and the worker participation rate rose to 50% from a month earlier, according to official data.
But Pınar Kaynak of the Center for Social Policy Research at TOBB University of Economics and Technology, said there are some 2 million people who are categorized as employed but are currently not actively working, either on the short labor pay scheme or unpaid leave.
“These people will be falling under the broad unemployment description after the layoff ban expires,” she told Reuters.
It could take up to two years for the services sector to return to previous employment levels even if all businesses reopen, Kaynak said.
“We could observe a spike in unemployment in July and August with the lifting of the layoff ban ... as these people could start actively looking for work,” she said.
Kaynak said the short labor pay should be extended beyond March 31 until at least the end of the year for the hardest-hit sectors.
