Recent Trends in Informal Employment in Turkey

Using micro data from TurkStat's 2000, 2006, and 2012 Household Labor Force Surveys, we examine the recent trends in informal employment in Turkey. Our descriptive analysis of the incidence of informal employment across broad categories such as sectors, occupations, and age groups is followed by an econometric exercise which aims to uncover the main determinants of informality status. We find that the gender difference in the rate of informality is present even when the sectoral composition of employment is controlled for. Alternative versions of the empirical model are estimated to assess the idea that the gender difference has to do with the fact that many women have indirect access to social security benefits as the insured person's wife or daughter. While our findings are in line with this hypothesis, we point to the lack of survey items that would have been more instrumental in uncovering to what extent 'indirect access to benefits' and various government policies contribute to the persistence of informality.