Turkey's minimum wage loses nearly 5,000 lira to inflation in six months

A new report from the DİSK Research Center (DİSK-AR) highlights the severe impact of inflation on Turkey's minimum wage, stating it has lost 4,986 Turkish lira in value as of June. This erosion of purchasing power comes despite official inflation figures showing a slight slowdown in the annual rate.

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Although the speed of inflation has slowed down largely due to the base effect, prices continue to rise. The decrease in the speed of inflation does not mean that prices are falling.

According to the Turkish Statistical Institute (TÜİK), the annual inflation rate stood at 32.11% in June. The six-month inflation rate was recorded at 17.76%, which has been used as the basis for wage increases for civil servants and pensioners. Consequently, SSK and Bağ-Kur pensioners received a 17.76% raise, while civil servants and their retirees saw a 13.52% increase.

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Inflation has a much greater effect on reducing the purchasing power of low-income earners and serves to distort income distribution.

The DİSK-AR report emphasizes that while the pace of inflation may have slowed due to base effects, prices continue to rise. It argues that inflation disproportionately affects lower-income groups, exacerbating income inequality. The center also raises concerns about the reliability of TÜİK's inflation data, noting that the institute stopped publishing its item price list in June 2022, making the figures more contentious.

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As of June, the minimum wage has lost 4,986 TL against inflation, while the lowest retirement pension has eroded by 3,552 TL in the same period.

"Even according to TÜİK's questionable inflation data, inflation continues to run high in Turkey," the report states, underscoring the ongoing economic challenges faced by many citizens. The findings suggest a significant gap between official statistics and the lived economic realities of those on fixed or low incomes.

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Meanwhile, suspicions about official inflation data continue. Inflation data has become even more controversial due to TÜİK's abandonment of publishing the item price list in June 2022.