Background
Turkey is undergoing a restructuring process that is characterized
by sectoral shifts, privatisation, public sector reform and post-crisis
economic adjustment, all of which are likely to displace large numbers
of workers. In addition, the expectation of a renewed economic crisis
due to the ongoing war in neighbouring Iraq aggravates the problems
already existing in the labour market, such as low and declining
labour force participation, high levels of unemployment, especially
youth unemployment, labour shedding, large informal sector, high
underemployment, lack of qualified human capital, skill mismatch
and lack of social dialogue. Moreover, the institutional framework
of employment and social protection in Turkey has been weak, although
a job security law and an unemployment insurance scheme have recently
been introduced. A new law defining the role and the capacity of
the Turkish Employment Organization (ISKUR), the only public agency
delivering employment services in Turkey, is also currently under
consideration.
Justification
In dealing with privatisation or recession-induced redundancy,
Turkey has mainly relied on passive labour market policies of income
replacement such as early retirement and severance payments (recently
also unemployment insurance), commonly used to protect the unemployed
and the laid-off workers without increasing their employability.
The active measures linking income replacement with active reintegration
and reallocation policies, on the other hand, have not been given
due attention.
As clearly documented in the aforementioned EMP/ANALYSIS study
on ALMP for restructuring in Turkey, there is ample scope for active
policies in the context of the Turkish labour market given the costliness
of the passive policies on the one hand and the low employment rates
on the other. ALMPs encompass measures to increase the quality of
the labour supply (training and retraining), measures to raise the
demand for labour (microenterprise development and self-employment
support, wage subsidies, public works and public service employment)
and measures to improve the matching of demand and supply (job search
assistance and employment services). The background study pointed
to the need to complement passive policies with such active measures
and particularly emphasized the significance of using new combination
of measures, using new implementation agents and structures, formulating
a better matching process between candidates and measures and promoting
more involvement of the social partners at both national, regional
and local levels in the process of policy design. The study argued
for a community-led approach for redeployment of retrenched workers,
which ought to be reinforced by improved public employment services.
In this context, two important elements were identified as matching
displaced workers and labour market measures through ‘profiling’
of both the unemployed and the vacancies in order to better allocate
people to programs and increasing training take-up by raising the
efficiency and appropriateness of training and by providing better
job consultancy.
Against this background, there is a need for this pilot project
on an experimental scale to explore the most appropriate policy
mix and implementation structure for Turkey and the most efficient
restructuring and functioning of ISKUR as the public employment
agency to carry out the important components of the national employment
policy. Indeed, the new ISKUR law foresees some thorough restructuring
of ISKUR and an increase in its role in the national employment
policy by implementing more ALMPs.
The project site has been selected as Kocaeli (Izmit) in consultation
with ISKUR for the following reasons:
• The number of registered unemployed is high (18,493);
• The number of unemployed receiving unemployment benefits
is high (1,318);
• Labour mobilisation is high;
• The province suffered deeply from the earthquake of 1999
and is still trying to recover from the employment consequences
of this disaster, as well as of the economic crisis of 2001;
• It is a dynamic and highly industrialised city;
• There is high migration to this province from the neighbouring
or surrounding provinces and from the South-East Anatolia region;
• The number of staff of ISKUR in Kocaeli is above average
(20);
• There are three large state-owned enterprises that are scheduled
to be privatised in the course of 2003 (PETKIM in petrochemical
industry, TUPRAS in petroleum refining and SEKA in paper industry).
Although the on-site work will be carried out by Turkish experts
under the authority of ISKUR, there are areas that need the assistance
of the ILO within the framework of the cooperation between ILO and
Turkey. As a follow-up of the first phase of this cooperation, the
ILO, as a tripartite organization, will draw on its experience in
using tripartite governance structures to bring solutions to labour
market problems and will:
• Act as a facilitator in the issue of social dialogue by
selecting, bringing together and providing the common ground for
social dialogue with national, regional and local actors with a
view to creating a social network that can be drawn upon to decrease
unemployment and to increase employment;
• Offer advice on the range of policies that ISKUR can put
in place;
• Set up training modules for ISKUR officials in restructuring,
redundancy management and job counselling.
Objective of the Project
The overall aim of this project is to improve the employment services
in the province of Kocaeli to be a model for the rest of the country
by employing ALMPs pre-determined through a labour market needs
analysis of the province and by involving all social partners in
order to decrease the level of unemployment caused by economic crises
and restructuring including privatisation. Target groups are registered
unemployed persons in Kocaeli. Specific objectives of the project
are:
• Increasing the effectiveness of social dialogue through
Local Employment Committees;
• Carrying out labour market needs analyses as an input into
the decisions to be taken about appropriate labour market policies
in the province;
• Evaluating alternative ALMPs, including the Training for
Self-Employment offered by ISKUR, and providing recommendations
for policies at the level of the province based on ILO expertise
and experience in restructuring situations (e.g. SIYB – Start
and Improve Your Business Program – of the ILO);
• Setting up and delivering training for ISKUR officials (15
persons) to achieve better rates of redeployment of displaced workers
by improving the match between unemployed persons and open vacancies
and by encouraging cooperation with (local) social partners during
this process;
• Monitoring and evaluation of the results.
Expected Outcome Upon Completion of the Project
• The approach of close cooperation and partnership with
local social constituents so as to offer more efficient employment
services will have been adopted by employment service providers
via training of 15 ISKUR officials.
• Effective decisions regarding labour market policies will
have been reached by the Local Employment Committee based on labour
market needs analysis.
• Local social partners will have enhanced their awareness
that ALMPs accompanying restructuring bring about positive results
indicated by the number of meetings and partnerships between local
constituents.
• ISKUR/Kocaeli will have improved public employment services
to better manage the redundancies and restructuring by:
» Determining the appropriate labour market policies to diminish
unemployment in the target group;
» Increasing the rate of utilization of ALMPs by the unemployed;
and
» Raising job placement rates.
Outputs
Output 1: Organisation of a workshop for the introduction of the
pilot and brainstorming with all social partners in Kocaeli
Output 2: Analysis of labour market needs at the level of the province
Output 3: Training of ISKUR officials
Output 4: Established infrastructure in Kocaeli for the unemployed
persons in the target group to benefit from ALMPs
Project Partners
The project will be coordinated by ILO/Ankara and ILO/HQ and executed
by ISKUR. The first step will be to identify, inform and bring together
the most important local, regional and national actors in order
to identify the needs in terms of accompanying measures for workers’
displacement, including an inventory of measures they have and new
measures that could be proposed based on other country experiences
(OECD and transition countries). According to the needs identified
and ALMPs to be implemented to meet them, training programs for
ISKUR officials will be designed in collaboration with ILO Training
Centre in Turin. The effects of improved employment services on
the number of unemployed and on the period of unemployment will
subsequently be monitored and evaluated.
Sustainability
The ILO will help to set up the project, but in the future this
will be a self-sustained process by ISKUR and the Turkish government.
The ultimate sustainability of the project will depend on the results
of the evaluation of the pilot. If successful, the project could
be operationalised throughout Turkey and in other similar developing
countries.
Inputs
• ISKUR will provide in-kind contribution such as office
space, transportation etc.
• ILO/Ankara will provide the funding for training as well
as for missions, seminars, workshops, translations, invited experts
etc. through cash surplus funds earmarked for this purpose
• ILO/HQ (EMP/ANALYSIS) will provide approximately 4 person-months
at professional level
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