Unemployment benefits allocated to employers more than unemployed

Turkey rises employers’ share in unemployment benefits as 5.8 billion allocated for the unemployed, 17.4 billion allocated for the bosses
Tuesday, 12 February 2019 15:36

The Unemployment Insurance Fund, which had a revenue of 34.6 billion last year, paid 5.8 billion to the unemployed while the share for the employers had been 17.4 billion in total, favoring bosses rather than supporting the unemployed.

The shares of the Fund, whose main purpose is to provide unemployment benefits, that are allocated for the active labor market and the incentives in favor of employers have been on the rise. The Confederation of Progressive Trade Unions of Turkey (DİSK) recently undertook research entitled ‘The Impact of Economic Crisis on the Working Classes and Work Life’.

The research demonstrated that the revenue and the spending of the Fund in the second half of 2018 have been worsened to the detriment of the working classes.

Ankara Chamber of Industry offered last year in September to pay the workers’ salaries from the Unemployment Insurance Fund since the industrialists “could not pay” them because of increasing exchange rates and current economic conditions.


In 2018, the total assets and revenue of the Fund reached 127.6 billion and 34.6 billion respectively whereas the spending for the employer incentives and support rose up to 10.7 billion. Once the spending for active labor market (4.9 billion) and workplace training programmes (1.8 billion) are added up, 17.4 billion in total is allocated for the employers. 

Accordingly, 50.4 percent of the revenue of the Fund is allocated to the bosses. In other words, the employers received 50.4 out of every 100 liras in the Fund revenue.

Nonetheless, the percentage of unemployment benefits is decreasing. In 2018, only 5.8 billion is paid to the unemployed. In 2016, unemployment benefits constituted 20.3 percent of the overall revenue. This percentage was reduced to 18 percent in 2017, and 16.9 percent in 2018. In this way, the unemployed received 16.9 out of every 100 liras in the Fund revenue.


In 2018, the employers received 10.7 billion incentive and support payment in return for the premiums they paid to the Fund. In this way, the percentage of incentive and support payment for the employers to the premiums paid by the employers has increased to 116 percent.

Such percentage was 13.8 in 2016 and 32.3 in 2017. Once the Fund’s revenue and spending are analyzed monthly, July stands out regarding the shift of balance.

In July 2018, the Fund had 2.9 billion revenue whereas it paid 4.2 billion for employer incentives and support as well as programmes on the active labor market.

The spending in the last few months of 2018 has also constituted half of the revenue. This demonstrates that the Fund has been utilized as a resource to compensate the election on 24 June 2018 and the economic crisis. The spending on employer incentives and support, as well as programmes on the active labour market, reached 2.5 billion in the second half of 2018. It has reached 13.6 billion in the last six months.


The number of unemployed who benefited from the Fund increased in the second half of 2018 as a result of the deepening of the economic crisis. In between January and December 2017, the number of unemployed benefited from the Fund decreased from 507 thousand to 408 thousand. Nevertheless, the number of unemployed benefiting from the Fund increased by 24 percent in December 2018 in comparison to last year and it reached 577 thousand.

The research undertaken by DİSK underlines that the Fund must be used for the unemployed. It also highlighted that conditions to benefit from the Fund must be eased during the economic crisis so that more unemployed could benefit from the Fund.