ISTANBUL- Turkey, which is reopening its economy after a coronavirus-related lockdown, will end a temporary wage support scheme, the labour minister said on Wednesday, although analysts and tourism representatives say it should be kept in place for now.
Ankara has used the so-called short labour pay system over the past three months to top up workers' wages and support businesses through the crisis.
With the lockdown measures eased, 400,000 people have left the system in the last 10 days, Labour Minister Zehra Zumrut Selcuk told Anadolu news agency. She said the system would be retired as part of the normalisation process, although it would be replaced by other support measures.
Selcuk said a ban on layoffs, which was due to expire in mid-July, would be extended for another three months.
More than 3.5 million workers have benefited from the short labour system, data from the ministry shows. Ankara has provided a total of nearly 20.5 billion lira ($2.99 billion) of support to more than 11.5 million households through various programmes since the pandemic began.
However, analysts and tourism sector representatives among others say the short labour system, which was implemented for three months, needs to be extended.
Muberra Eresin, head of the Hotel Association of Turkey (TUROB), said short labour pay would be very important for employment in the sector.
"We don't want to lose our qualified employees. If the employment support is extended for at least three months, it will be very beneficial for us," she told Reuters before Wednesday's announcement by the Labour Minister.
Seyfettin Gursel, an economist at Istanbul's Bahcesehir University, has said there would be a wave of job losses if measures were not extended as it will take a long time for some business to return to pre-coronavirus levels. ($1 = 6.8572 liras)
(Reporting by Birsen Altayli, Ceyda Caglayan and Nevzat Devranoglu; Writing by Ali Kucukgocmen; Editing by Jonathan Spicer, Kirsten Donovan) ((ali.kucukgocmen@thomsonreuters.com , @alikucukgocmen; +902123507067; Reuters Messaging: Reuters Messaging: ali.kucukgocmen.thomsonreuters.com@reuters.net))
