The annual minimum wage increase, normally applied once a year, was raised twice in 2022. After the mid-year raise implemented in July, announced with the phrase “We will not let inflation crush our citizens,” the President signaled the possibility of another increase later in the year.
Legally there is no obligation to raise the minimum wage again until July of the following year, but rumors and political signals about a year-end increase before December have created new expectations for workers and employers alike.
THREE RAISES COULD OCCUR WITHIN A YEAR
Statements by the President and the Minister of Labor and Social Security, Vedat Bilgin, increased the likelihood that another raise could be implemented before the end of 2022, possibly in December. If carried out, minimum wage earners would have received three separate increases within one year.
This new expectation raises the question: will the additional raise affect August payrolls? The mid-year increase announced for July 2022 was formally published in the Official Gazette on June 30. Following that regulation, the mid-year adjustment is reflected in August salary payments.
NOT LEGALLY REQUIRED, BUT POSSIBLE
During a meeting with industrial workers in Kayseri, the President hinted that a new minimum wage increase could be considered at the start of the next year. Legally, the minimum wage is usually adjusted once a year; the July raise removed the legal obligation for a December increase. Still, the President’s remarks suggested the government might choose to introduce another raise in December if conditions warrant it.
Speaking to workers, the President said: “We raised the net minimum wage up to 5,500 TL. We will not let our citizens be crushed by inflation. I ask for patience. At the start of the year we will reassess the situation and take necessary steps.” He reiterated his call for patience from the public.
“WE WILL IMPLEMENT A NEW ADJUSTMENT AT YEAR-END”
After the increase in January, a further raise was applied in July. From July 1 forward the minimum wage became gross 6,471 TL and net 5,500.35 TL.
The January 2022 raise represented roughly a 30% increase compared to the prior level. Cumulatively compared with 2021, the minimum wage rose by approximately 95%.
Minister Vedat Bilgin signaled openness to another adjustment: “At year-end we will evaluate all conditions and implement a new regulation if necessary,” he said, adding, “We will not allow our workers to be squeezed. We oppose any measures that harm labor.”
MINIMUM WAGE REMAINS BELOW THE HUNGER THRESHOLD
According to the minimum wage table released by Türk-İş to the press, the net increase amounted to 29.32%. The worker’s daily wage rose to 183 TL, while the net hourly wage reached 24.45 TL. Türk-İş also updated its poverty and hunger thresholds for a household of four: the hunger threshold for June stood at 6,391 TL, and the poverty threshold rose to 20,818 TL.
The cost of living for a single worker was calculated at 8,831 TL per month. The announced minimum wage remains below the hunger threshold.
EMPLOYER COSTS EXCEED 7,000 TL
These developments in the minimum wage brought past records back into public discussion. A clip of the President’s 2011 speech in Adana circulated widely on social media, reminding viewers of earlier promises about purchasing power. In that speech he said, “If you can buy fewer eggs, milk, cheese, or bread now than you could with the minimum wage eight years ago, do not vote for us.”
In 2022 the minimum wage rose to 4,253 TL, and the mid-year adjustment in July was around 30%, bringing the net amount to 5,500 TL. That mid-year increase added roughly 1,244 TL. With the most recent figures, the total employer cost reached approximately 7,603 TL.
SSK, BAĞKUR, AND CIVIL SERVANT PENSIONS: NEW YEAR INCREASE
With the minimum wage a central topic, social security experts also highlighted likely year-end raises for retirees and civil servants. July’s inflation figure produced a 2.37% inflation difference. Considering inflation through December, official inflation rates could result in an estimated 15% inflation adjustment for civil servant retirees, SSK, and BAĞ-KUR pensioners in the new year. If comparable monthly inflation continues through the end of the year, a 15% increase would become highly likely.
ISTANBUL BREAKS RECORD IN INFLATION
Turkish Statistical Institute (TÜİK) published July consumer price index (CPI) data showing an annual increase of 79.60% and a monthly rise of 2.37%. The Producer Price Index (PPI) reported an annual increase of 144.61% and a monthly increase of 5.17%.
The Istanbul Chamber of Commerce released price index data for June, noting in an August 1 report that Istanbul recorded the highest inflation level in July among provinces. Retail prices in Istanbul rose by 99.1% year-over-year, marking the highest recorded level since 1998 based on the compiled data.