Türkiye’s labour market displayed significant annual wage increases and a rise in working hours in the first quarter of 2025, despite a slight quarterly dip in employment, according to data released by the Turkish Statistical Institute (TurkStat) on Thursday.

The gross wages-salaries index, covering industry, construction, and trade-services, soared by 44.7% year-on-year. The trade-services sector led with a 49.1% increase, followed by construction at 43.3% and industry at 38.5%. Quarterly data also showed strong wage growth, with a 10.5% rise compared to the previous quarter, driven by construction (12.4%), trade-services (11.7%), and industry (8.4%).

The hours worked index grew by 2.4% annually, with trade-services (+4.2%) and construction (+2.1%) driving the gains, while the industrial sector saw a 0.6% decline. On a quarterly basis, hours worked rose by 1.6%, with construction (+2.4%), trade-services (+1.8%), and industry (+0.9%) all contributing.

The employment index posted a modest 1.4% annual increase, propelled by trade-services (+3.1%) and construction (+2.7%), though industrial employment dropped by 2%. Quarterly figures revealed a slight 0.2% decline in overall employment, with industry (-1.1%) and construction (-0.8%) contracting, while trade-services eked out a 0.4% gain.

Hourly labour costs surged 41.5% annually, with trade-services leading at 43% and construction close behind at 46.8% for non-earnings costs like social security contributions. The hourly earnings index rose 41.4% year-on-year, with quarterly increases of 8.5% for labour costs and 8.8% for earnings.

The data highlights robust wage growth and rising labour costs, fueled by inflationary pressures and strong demand in trade-services and construction. However, declining industrial employment and hours worked suggest challenges in manufacturing. The trade-services sector’s resilience continues to bolster Türkiye’s labour market, but analysts will monitor whether industrial slowdowns signal broader economic shifts. (ILKHA)