Minimum wage announced: Business world's first reactions to the 17,002 lira minimum wage

Following the determination of the minimum wage for the new year, statements from the business world have come one after another. Representatives of the business world, who stated that they find the increase in employees' purchasing power during this inflationary period very valuable, made noteworthy remarks.

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Minimum wage announced: Business world's first reactions to the 17,002 lira minimum wage

Representatives of the business world stated, "The effort shown to increase employee welfare during a period when we are trying to increase production and exports is promising.

We believe that support should be increased regarding the cost of the minimum wage increase to the employer.

We must also emphasize that it is of great importance that Turkey does not lose its competitive power, especially in exports."

According to the news in Bloomberg, Istanbul Chamber of Commerce (ITO) President Şekib Avdagiç stated in a post on his X account, "I hope the minimum wage for 2024 will make positive contributions to the welfare of our employees, our companies, and the development of our country. Best of luck."

Foreign Economic Relations Board (DEİK) President Nail Olpak:

It is certainly gratifying that such important data, which affects living conditions and income distribution on one hand, and employer costs, international trade competitiveness, and production on the other, has emerged by majority vote.

We find the increase of the minimum wage to 17,002 TL with the 49 percent raise valuable in terms of the share of labor in national income reaching deserved levels and increasing the inclusiveness of growth.

On the other hand, increasing the portion of the burden on the employer covered by the state from 500 TL to 700 TL per employee is an important support, especially in terms of not negatively affecting the competitiveness of our exporters in international markets.

Union of Chambers and Commodity Exchanges of Turkey (TOBB) President Rifat Hisarcıklıoğlu:

May the minimum wage be beneficial to our country and our nation. Income tax brackets should also be updated upwards to increase the purchasing power of employees.

Our agenda is production, investment, employment, and exports.

In order to protect our country's production power and ensure that the sustainability of companies is not harmed, the fight against inflation must continue decisively, and support for the real sector must be increased and continued.

Istanbul Commodity Exchange President Ali Kopuz:

From this point on, our expectation will be the management of a sensitive process where price stability is ensured, employment remains strong, and economic activity continues at a level that maintains this.

Especially since the pandemic, the inflationary environment that has gained weight in the global economy, primarily due to food prices, has also been a major pressure factor on real incomes. We have started to see the balancing effects of the tight monetary policy measures currently being implemented on domestic demand. However, we cannot pass without stating this situation.

Those who see no harm in speculating about the raise to come to the minimum wage even when the figure is not yet known, and those who price the final product in advance as if all costs stem from wages, are, to put it mildly, not acting fairly.

A figure has been announced that will support both the welfare of salaried employees and economic activity. On the other hand, I find the increase of the minimum wage support, which was applied as 500 liras, to 700 liras meaningful in terms of helping to lighten the burden on employers.

Ankara Chamber of Commerce (ATO) President Gürsel Baran:

The minimum wage is an important figure that affects not only workers but also employers and the public, as it forms the basis for other wages and affects production and business costs.

Ankara Chamber of Industry (ASO) President Seyit Ardıç:

For sustainability in production, investment loans and incentives need to be continuous until the goal is reached. With the motto that every factory is a fortress, we will continue to work, produce, and create employment.

Istanbul Leather and Leather Products Exporters' Association (İDMİB) Chairman of the Board Güven Karaca:

It is our common desire that our employees are not victimized and live in prosperity. We are moving as a team with our employees toward our goal of increasing production and exports. However, at the point we have reached, while the wage increases made lose their meaning for employees, they create the exact opposite situation on the employer side. When looked at, despite the raises, the decline of the minimum wage against per capita national income continues.

In other words, the purchasing power of the minimum wage earner is decreasing day by day despite the increase. However, the effects on the employer side are different. We will see the effects of the minimum wage increase especially in labor-intensive sectors such as textiles, ready-to-wear, leather, and leather products. As industrialists and exporters, we were able to reflect the increase in the minimum wage to costs in the last few years.

Because, alongside the increasing domestic demand, our exports were also performing strongly. In the process that began with 2023, however, declines began to be experienced in industrial production and exports. In a period where our competitive power in the world is decreasing, our export markets are shrinking, and imports are increasing, I think we will have difficulty in managing employee expenses.

I am of the opinion that making a one-time increase in the minimum wage will be beneficial for the employer in terms of determining annual costs. On the other hand, it could also be useful to make a structural change in the minimum wage. Additionally, just as a regional minimum wage could be determined, the issue of differentiating the minimum wage in Istanbul and other cities could also be put on the table.

Istanbul Mineral Exporters' Association (İMİB) Chairman of the Board Rüstem Çetinkaya:

There has been a serious inflation increase process in recent times. With the changing economic management, a serious fight against inflation has begun. However, at the point reached, it was essential to make an adjustment to the salaries of our employees whose purchasing power has fallen. We think that with the increase in the minimum wage, our employees will be relieved to some extent.

On the other hand, there is a cost that the minimum wage creates for the employer side. Considering the worsening conditions in the world, shrinking export markets, hardening competitive environment, and rising costs, we can say that a more difficult year lies ahead for exporters.

At this point, we expect much more serious support from our state to reduce the cost pressure on the employer side and not to lose our competitive power. As exporters, we will continue to do more than our best to increase production, exports, and employment with the strength we receive from our state.

Istanbul Ferrous and Non-Ferrous Metals Exporters' Association (İDDMİB) Chairman of the Board Çetin Tecdelioğlu:

The increase in the minimum wage is very valuable in this difficult process that our country and the world are going through. At this point, as the producing power of the country, we will continue to stand by our employees at all times. Our greatest wish is for the welfare level of our employees to rise and their purchasing power to increase. However, we also expect support from our state on the employer side.

Especially regarding employer contribution shares, it would be beneficial to increase the figures even for the first 6 months of the year. This support is very valuable for us industrialists and exporters. Apart from this, we believe that providing extra support, especially for industrial establishments in the earthquake zone, will provide great benefit.

As exporters who work for their country, produce for their country, and provide employment, we will continue our efforts to further increase production, exports, and employment.

Istanbul Cereals, Pulses, Oil Seeds and Products Exporters' Association (İHBİR) Chairman of the Board Kazım Taycı:

I wish the increase made in this environment, where the purchasing power of our employees has fallen against high inflation, to be beneficial. Increasing the earnings of our employees and further raising their welfare levels are among our greatest wishes. For the increase in the minimum wage to be meaningful, it depends on curbing inflation. We are also following the efforts of our economic management in this direction with appreciation.

As employers, we will continue to stand by our employees at all times. On the other hand, we must say that we also have some expectations as exporters.

We stand out in the world with our competitive structure. Considering the rising costs, developments in the world, and changing export markets, we expect support from our state in order not to lose our competitive power. Employment costs are a factor that directly affects the competitiveness of employers. At this stage, the continuation of minimum wage support is very valuable.

Istanbul Textile and Raw Materials Exporters' Association (İTHİB) Chairman of the Board Ahmet Öksüz:

I hope the new minimum wage will be beneficial to our country, especially our employees. While going through an inflationary period, we appreciate the effort shown not to victimize employees. As industrialists and exporters working for their country, we must say that it is very important not to ignore the burden on employers, taking into account the realities of the economy.

However, there is a decrease in production in our sector due to the demand contraction experienced on a global scale. The increase in the minimum wage increases our production costs, but we cannot reflect this in export prices. I would also like to emphasize that it is very important that Turkey, which is the fifth largest textile exporter in the world, does not lose its competitive power with rising costs.

In this framework, we think that some additional cost elements, such as the tax burden on the minimum wage, should not be reflected to the employer, especially in sectors in the manufacturing industry. Thus, both our workers can earn and the employer can at least reduce their costs to rational levels.

Istanbul Carpet Exporters' Association (İHİB) Chairman of the Board Ahmet Hayri Diler

The increase in the minimum wage is quite important in terms of employee welfare. We believe that our employees will be relieved to some extent with the increase made in a period when purchasing power has fallen. As a country, we are working with all our might to increase our production and exports.

Here, we are walking hand in hand as industrialists and employees. As important as it is for our employees' purchasing power to increase, it is just as valuable for employers to be supported.

Considering that exchange rates have not increased at the rate of inflation, we must emphasize that it is very important that the support given to exporters is increased so that they do not lose their competitive power. Moving on a balance is very critical for the development of the country.

News Source: 12punto