The rise in stocks did not provide jobs

■ Tolga UĞUR

EXCHANGE Istanbul’s BIST 100 index rose rapidly as political uncertainty faded after the election, offering concrete gains to investors. While the index has risen 45.7 percent this year, it has appreciated 77.3 percent since the end of May. While the BIST exceeded $300 per $100, the number of investors in the stock market increased in the same period by approximately 2.8 million people, reaching 7.8 million. Despite the rapid increase in the general stock market index, employment in companies increased by only 0.25 percent in the first six months of 2023, reaching 930,000 people. According to data collected from Fintables and company activity reports, the employment of some of the companies in the BIST 100 index may not even reach four-digit values. In four companies the number of employees is less than 100. Although employment increased in 56 companies in the index in the first half of the year compared to December 2022, it decreased in 37 companies. Either there were no changes in the employment data of the remaining companies or their data could not be accessed.

THE INDEX HAS DOUBLED

According to available data, compared to the first 6 months of 2022, the company where employment increased the most was one of the main automobile brands. The automotive brand, which has seen a sharp rise in its shares, increased its employment by more than 8,000 people in the last year to exceed 20,000. The largest decline in the index was recorded by a holding company, whose number of employees decreased by more than 1,400 (2.2 percent) in the last year. On an annual basis, while employment increased in half of the BIST 100 companies, the number of employees decreased in 21 companies. In the same period, the rise in shares of BIST 100 companies exceeded 100 percent.

The increase in the exchange rate affected

Dynamic investment securities research expert Ceyhun Yavaş, when asked to what extent the rise in stocks affects employment, pointed to loans and exchange rates and said: “We also find it useful to note that, especially with the effect of the increase in exchange rates, This situation generates pressure on the balance sheets of some companies and does not contribute to employment. “We think that the contribution of companies to employment will increase if there is a fall in inflation, credit opportunities are reopened and the costs of access to credit are at low levels, although not at previous levels.

‘The goal is level 10 thousand’

Ceyhun Yavaş noted that despite the limited increase in employment, the non-application of inflation accounting was effective in increasing profits in many companies and sectors well above inflation and therefore the figures may have increased. Although Yavaş stated that there were withdrawals in the BIST 100 index due to geopolitical risks and the intensity of credit transactions, “Despite this strong movement, we do not see a deterioration in the trend of the index. “We maintain our view that the 10,000 level will be the target in the medium term,” he said.