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Mehmet Naci EFE, Chairman of the Board, EkolGrupCorp., Istanbul / Turkey

Abstract: This study analyzes industrial labor input indices and employment data using various statistical methods. Industrial power plays a crucial role in reducing foreign dependence for both developed and developing countries. In Turkey, this power has continued to develop, showcasing significant progress in industrial inputs and employment rates over the past decade. Despite the persistent issue of informal employment, the industrial sector remains on a growth trajectory. This applied research utilizes data from the Turkish Statistical Institute (TUIK) spanning 2002-2015, analyzed through E-Views 8.0 software. Regression and correlation analyses have identified the factors most influencing labor.

Keywords: Labor, Input Index, Industry, Employment, TUIK

Introduction: The development level of a country is closely linked to its industrial labor force. Developed nations typically possess a more advanced, systematic, and effective labor force compared to developing or underdeveloped countries. A lower real income per capita, larger rural populations, lower literacy rates, shorter life expectancy, and reduced economic sufficiency are common characteristics of less developed nations. Economic development levels are vital indicators of a country’s overall development.

A nation’s competitiveness, superiority, and economic power are heavily reliant on its industrial strength and production rates. Industrially underdeveloped countries struggle to achieve high levels of welfare, as economic sufficiency is closely tied to employment rates and the overall welfare of its population.

Theoretical Framework and Literature Review: Traditional foreign trade theories suggest that each country has a comparative advantage in certain goods or services. Underdeveloped countries often rely on importing industrial products due to their factor endowment and technological structure. With the globalization wave of the late 1980s, every country has become part of a global market, eliminating quotas and restrictions, and embracing a free market system.

Globalization has also led to financial globalization and economic superiority through capital movement. Historically, economic activities were defined by the trade of goods and services. Today, this has expanded to international activities, where developed countries export their superior goods or services to gain economic benefits.

In Turkey, industrial employment rates have shown improvement. Since 2014, the employment rate in the industrial sector has increased by 0.5%, total hours of work by 0.5%, and gross income levels by 3.6%. This indicates a reduction in foreign dependence alongside industrial growth. However, informal employment remains a significant issue, impacting social security and economic input in the public sector.

Aim, Scope, and Method: This study examines the relationship between key labor variables using data from TUIK for the period 2002-2015. The data were analyzed using E-Views 8.0 software to identify the most impactful factors on labor through regression and correlation analyses.

Data Analysis: The study’s hypotheses were tested through regression and correlation analyses, revealing significant relationships among employment index, working hours, wage index, and labor input index.

Hypotheses:

• H0: There is no relation among the variables.
• H0: There is no relation between the employment index and other variables.
• H0: There is no relation between working hours and other variables.
• H0: There is no relation between the wage index and other variables.

Implementation and Analyses: The variables were abbreviated as follows:

• EMP: Employment
• HW: Hours worked
• WI: Wage index
• LII: Labor input index

Correlation Analysis: The correlation analysis showed that:

• Employment index has a high correlation with wage index and working hours, and a moderate correlation with labor index.
• Working hours have a high correlation with wage index and a moderate correlation with labor index.
• Wage index has a moderate correlation with labor index.

Regression Analysis: The regression analysis indicated that:

• A one-unit increase in working hours increases the employment index by 0.80 units.
• A one-unit increase in wage index increases the employment index by 0.07 units.
• A one-unit increase in labor index increases the employment index by 0.10 units.
• A one-unit increase in wage index increases working hours by 0.26 units.
• A one-unit increase in labor index increases working hours by 0.61 units.
• A one-unit increase in labor index increases the wage index by 1.35 units.

Conclusion and Assessment: The study concluded that there are significant correlations among employment, working hours, wage index, and labor input index. The findings highlight the importance of fair wages and proper employment practices to enhance productivity and performance in the industrial sector.

References: The study references works by Baumol (1994), Cavelaars (2005), Chang et al. (2009), Dibooğlu and Enders (2001), Gali (1999), Hall et al. (2007), Malley et al. (1997), Pazarlioglu et al. (2007), Pissarides et al. (2004), Petersen et al. (2006), Stiglitz (1984), Tunç (2007), Wakeford (2004), Yusof (2007), and Yusop et al. (2005).

This blog post provides a comprehensive analysis of industrial labor input indices and employment trends in Turkey, emphasizing the importance of industrial power in reducing foreign dependence and promoting economic development.