Labor – capital gap opened

COPPER While the uninterrupted growth process in national income slowed down in the last quarter, reaching 9 quarters, the share of the labor sector dropped to the historical bottom. In the first quarter of 2016, the share of labor in national income caught the share of capital. In the following period, the scissors began to open again. While the share of capital in national income increased by 13.7 points from 41.1 percent to 54.8 percent, the share of labor decreased by 14.2 points from 40.5 percent to 26.3 percent. opened. While Turkey’s gross domestic product (GDP) growth slowed in the 3rd quarter of this year, the continuous growth process reached 9 quarters in a row, and it was determined that the share of the working population in national income dropped to the historical bottom. According to the GDP data of the Turkish Statistical Institute (TÜİK) for the third quarter of this year, the uninterrupted growth process that started after the 10.3 percent shrinkage of the Turkish economy in the second quarter of 2020, reached 9 quarters as of the July-September period of this year. reached. However, as of the third quarter of this year, the growth rate slowed down to 3.9 percent. During the aforementioned uninterrupted growth period, the Turkish economy recorded a record growth of 22.2 percent, especially in the third quarter of 2021, while growth rates ranging from 6.4 percent to 9.6 percent were measured in other quarters. Employees became poor as the economy grew GDP growth data announced by TURKSTAT also revealed a remarkable change against the labor sector. When the shares of GDP components in gross value added by income method are analyzed, the ratio of “net operating surplus/mixed income”, which shows the share of the capital sector in national income, was 54.8 percent as of the 3rd quarter of this year, while “labor payments”, which indicates the share of the labor sector, The share of ” was 26.3 percent. The TUIK data set shows that the labor-capital gap in the denominator of national income has widened especially since 2016, and this trend has gained great momentum in the last two years. As of the first quarter of 2016, the share of net operating surplus/mixed income in gross value added was 41.1 percent, while the share of labor payments was 40.5 percent. In other words, the share of labor in national income caught up with the share of capital, and the gap between the two groups was almost closed. In the following period, an increasingly deteriorating picture was encountered against the labor sector. The labor-capital scissors opened wide Accordingly, in the period from the first quarter of 2016 to the third quarter of 2022, the share of capital in national income increased by 13.7 points, while the share of labor decreased by 14.2 points. As of the third quarter of 2022, compared to the first quarter of 2016, national income increased by 649.8 percent and gross value added by 661.3 percent at current prices, while the increase in net operating surplus/mixed income, which shows the share of the capital sector, reached 914.7 percent; The increase in labor payments, on the other hand, was well below this growth with 395.3 percent. The share of labor is below 2002 In 2002, when the destruction of the 2001 crisis, which upset all the balances in the economy, was tried to be repaired, the shares taken from the national income pointed to a more equitable distribution. According to TUIK data, while the share of the capital sector in the national income was 53.8 percent in 2002, the share of the labor sector was 28.3 percent, which was higher than in the third quarter of this year. By 2010, while the share of labor exceeded 30 percent, the share of capital was 52.1 percent. The scissors, which almost closed in the first quarter of 2016, opened rapidly especially in the last two years and the share of labor in national income decreased to 20 percent. Is economic growth enrichment? Economic growth means increasing the production capacity of the economy and thus producing more goods and services. The increase in production capacity depends on increases in production factors and developments in technology. Growth of national income does not mean that everyone in the growing economy becomes equally wealthy. TurkStat’s historical data set on national income shows that while banks, lenders, rentiers and companies benefit greatly from the national income growth, the majority of the country’s population is affected by taxes, high inflation, high unemployment, excessively volatile exchange rates, and high interest rates. It shows that the working class and middle class, such as workers, civil servants, do not receive their fair share.