Turkey’s monthly minimum wage will be 17,002 Turkish lira ($578.31) in 2024, Labor Minister Vedat Işıkhan said on Wednesday, marking a 49 percent increase from the level determined in July and a 100 percent hike from January, Reuters reported.
“We are pleased to once again fulfil our pledge to prevent our workers from being crushed by inflation,” Işıkhan said. About a third of the population of 86 million people earn the minimum wage, and other salary rises are determined by the base pay.
Turkey’s annual inflation rate edged up to 61.98 percent in November, its highest level this year but just shy of expectations, signaling that an aggressive rate-hiking cycle may be beginning to cool demand.
Inflation soared after a currency crisis at the end of 2021 and touched a 24-year peak of 85.51 percent in October last year. This year, the lira has so far lost some 35 percent of its value, compounding the cost-of-living crisis for Turks.
Higher wages are feared to strongly contribute to pushing up inflation, which reached 62 percent last month. The central bank was only expecting a peak to be reached in May at 70 percent, and it may now be forced to continue raising interest rates to cool demand.
The bank has lifted the benchmark interest rate by 34 percentage points since June after President Recep Tayyip Erdoğan was re-elected and appointed a new governor to undo his pre-election economic policies. He had forced the previous bank chief to cut interest rates to single digits to expand the $900 billion economy during his election campaign.
Turkey is scheduled to hold local elections on March 31. Erdoğan has vowed to retake control of İstanbul, the biggest city, and the capital Ankara from the opposition, building on the momentum of his re-election earlier this year, when he began his third decade at the helm.