Turkish government has announced a 30 percent increase in the monthly minimum wage for the year 2025, raising it to 22,104 Turkish lira ($630.36) from 17,002 lira in 2024, the state-run Anadolu news agency reported on Tuesday. The announcement was preceded by Turkey’s largest labor union federation Turk-Is leaving the collective bargaining table in protest of the low-ball minimum wage hike. The annual hike is line with the expectations of global funds and economists, but does no more than alleviate blue-collar poverty for a couple of months. Recent polls show Erdogan’s AK Party rising in the polls, but his treatment of labor may reverse this process. On the other hand, even this meagre rise in the minimum wage will prove inflationary, eliminating the possibility of reaching year-end 2025 CPI target of 21%.
President Recep Tayyip Erdoğan made this announcement, which is expected to affect more than seven million workers, on X on Tuesday evening.
Opposition party leaders and labor union representatives have expressed disappointment over the minimum wage hike, accusing the government of ignoring the high cost of living in the country.
The Confederation of Turkish Trade Unions (Türk-İş) announced last week that it had expected the minimum wage to be 29,583 lira. In a statement released later on Tuesday, the labor union said that the amount announced by the government is “far from” meeting the workers’ expectations.
“Even if the minimum wage was determined for a period of six months, it would still be at an unacceptable level. However, the announced figure will remain valid for an entire year,” Türk-İş said in its statement.
Economists predict that this minimum wage increase will contribute to rising inflation in the coming months. According to calculations by Reuters based on central bank studies, a 25 percent wage increase would raise annual inflation by between 1.5 and 5 percentage points.
While there was no consensus forecast, experts’ predictions centered around a 32.5% annual hike. In Turkey the minimum wage is extraordinarily important, because 30-40% of the blue collar workers earn around that sum, while it also serves as a benchmark for private sector.
Pro-opposition economists reacted in angrily in social media:
Prof. Dr. Özgür Orhangazi: The Nebati program (former economy czar) melted wages with inflation. Simsek’ stabilization program suppresses wages under the pretext of fighting inflation. Clearly, the entire burden of that war falls on the employees as a whole.
Prof. Dr. Ceyhun Elgin: A 30% increase in the minimum wage will not increase the purchasing power of employees in the face of 45% inflation, on the contrary, it will decrease it further. This picture clearly shows that the economic management has failed in the fight against inflation and has made those who earn their living by their labor pay the price of this failure.
Prof. Dr. Hakan Kara: I don’t know about inflation, but it is certain that minimum wage is defeated by the price of a sandwich.
Prof. Dr. Cem Başlevent: With the minimum wage remaining at 22 thousand 100 lira, space has been opened for the Central Bank to reduce interest rates on Thursday. Yet, the inflationary effect of the 40-45 percent increase would tie Central Bank’s hands to go fast on monetary loosening.
Prof. Dr. Cem Oyvat: İTO’s consumer inflation is 58%, TÜİK’s consumer inflation is 47%, Türk-İş’ annual increase in the hunger line is 47%, minimum wage increase is 30%. In the absence of elections, this is what the workers will get year after year! The numbers are in line with what the Western capital demanded.
Prof. Dr. Ensar Yılmaz: It is very clear that the low minimum wage and interest rate reduction (possible) prioritize businesses. It is a policy of keeping capital alive at the expense of workers crawling. Not only is this immoral, its economic rationality is limited, it should not be forgotten that inflation has been in the service sector, from the consumption of which the poor have been excluded for a long time.
Prof. Dr. Serdal Bahçe: Minimum wage has been announced, 22 thousand and 104 TL. This does not mean poverty, it means hunger. Moreover, in a country where the majority of wage earners work within the minimum wage band, this means the average wage. The Turkish working class has never been so humiliated. This is the order of capitalists, if you like.
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