I really do not know much about the agricultural sector and I do not generally assess data on the agricultural sector. Nonetheless, today I want to write some comments on the value added created in the agricultural sector and employment.  Let's see.

Comparison of the share of agriculture as a sub-sector of the gross domestic product (GDP); i.e. the value added of the agricultural sector increased only by 11.5 percent over the eleven years from 1998 to 2009. To put it differently, value added of the agricultural sector increased by 1 percent in average each year.

However, over the same period, value added in sectors other than agricultural sector increased annually by 3.2 percent in average. When the period is shortened, the unfavorable developments in the agricultural sector become even more evident: Between 2005 and 2009 annual average pace of increase in agricultural value added is only 0.5 percent. An opposite movement is observed for the years 2008 and 2009. Non-agricultural GDP grew only by 0.3 percent in 2008 and contracted by 5.6 percent in 2009. But, over the same period the growth in the agricultural sector was 4.3 percent and 3.6 percent, respectively. Let me underline that this is not specific to the mentioned years.

In the 1998-2009 period, average increase in agricultural value added is quite below that in the other sectors while in 2000, 2002 and 2005 agricultural sector enjoyed increases in the value added. A movement in the opposite direction was also observed in the first quarter of 2010. Agricultural sector contracted compared to the same period in the year before while non-agricultural sectors enjoyed growth.

Therefore, the first point to underline should be this: When the data for the last decade is observed, things are not going right in the agricultural sector, though some significant fluctuations exist. Given the rate of increase in population over this period, agricultural value added per capita drops. This is a development that will be a major challenge over the period ahead.

Employment in the agricultural sector fluctuates considerably. Annual averages suggest that agricultural employment in 2007 is lower than that in 2006, which is also lower than that in 2005. On the other hand, in 2008 and 2009 agricultural employment tends to increase. This is expected to some extent in periods of crisis since some of those who lost their jobs in urban areas 'move back to the village'.  The level of agricultural employment in 2009 is almost the same with that in 2005. So let this be the second point to underline.

After the 'remote' points above I would like to switch to a 'magazinish' subject. Over the first four months of 2010 interesting developments with respect to the agricultural employment were seen: Agricultural employment continued to increase considerably compared to the same period in the year before: Compared to the first four months of the year before, average employment in agricultural sector is 14.6 percent higher.

Of course such a significant increase is striking alone. But it gets even more interesting when compared with the increase of value added in agricultural sector: As I also said above, over the first three months of the year value added in agricultural sector contracts by 3.2 percent. On the other hand, over the same period agricultural employment increases by 15.1 percent. I will give a graph instead of an exclamation mark: Graph 1 shows the annual rate of growth of agricultural sector value added and employment in the first quarters from 2006 to 2010.

Over the examined period employment rises while value added falls also in 2007. But rate of increase in employment in 2007 is quite lower than that in 2010: 5.1 percent and 15.1 percent, respectively. So you wonder the reason of this difference. As you might remember, before I drew attention to the difference between the industrial production and industrial sector as a sub-item of the GDP since 2008: Industrial value added increased more rapidly that implied by the rate of increase in industrial production. One reason for this could be that since 2008 industrial production concentrated on products with higher value added. A second reason might be that TURKSTAT updated the method of calculation in the context of the new input-output tables.

But now, we have a different situation for the agricultural sector. Let us seek for a reasonable explanation: "Agricultural value added decreased in the first quarter of 2010. But agricultural production increased significantly since the sector started to produce lower value added products. Therefore, it is not odd that employment continues increasing while value added decreases since level of production did not fall." Does this make sense? As I said before, I am not good at this. Maybe someone who is would help. 



Graph 1: Changes in agricultural value added and agricultural employment (first quarters, %)

This commentary was published in Radikal daily on 19.07.2010