Does Decent Work Promote Economic Growth? Asymmetric Evidence From Türki̇Ye

Economic growth is often measured by the size of a nation's output, a number that rises when factories produce more and services expand. For decades, the prevailing assumption was that a growing economy would naturally lift all boats, creating better jobs and higher living standards as a side effect. However, a growing body of thought suggests that the quality of work matters just as much as the quantity of jobs. This idea, known as "decent work," goes beyond simply having a paycheck. It encompasses fair wages, safety on the job, security against sudden dismissal, and the ability for workers to have a voice in their workplace. When these conditions are met, workers are healthier, more skilled, and more productive, which in turn fuels the economy. The question researchers have long debated is whether investing in these human conditions actually drives economic growth, or if the relationship works the other way around.

A team of researchers from universities in Türkiye set out to answer this question by looking at their own country's economic history over the last two decades. They focused on the period between 2000 and 2021, a time when Türkiye experienced significant economic shifts. Instead of treating economic growth as a simple, straight-line result of job creation, the team used a sophisticated method to see if improvements in work quality had a different effect than declines in work quality. They gathered data on real economic output per person, alongside a composite score for decent work that combined factors like employment opportunities, income adequacy, and social protection. They also accounted for other major economic forces, such as inflation, the amount of money spent by the government, the level of investment in physical machinery and buildings, and the overall level of human development in the country.

The analysis revealed a clear and powerful connection: when the quality of work improves, the economy grows. Specifically, the researchers found that a one percent improvement in the conditions of decent work leads to an approximate 0.22 percent increase in the country's economic output per person over the long term. This confirms that treating workers well is not just a social goal but a productive one. However, the story is not symmetrical. The study showed that the positive impact of making work better is much stronger than the negative impact of making work worse. In other words, the economy gains significantly more from upgrading job quality than it loses when job quality slips. This suggests that the relationship between work and growth is not a balanced scale, but rather a system where progress is rewarded more heavily than regression is punished.

The study also examined other factors that drive the Turkish economy. It found that investing in physical capital, such as factories and infrastructure, and improving the overall education and health of the population consistently boost economic growth. Conversely, high inflation and government spending that is not directed toward productive investments were found to hinder growth. Interestingly, while foreign investment is often seen as a key engine for development, the data showed that it did not have a statistically significant long-term impact on growth in Türkiye during this period. The researchers suggest this is because much of the foreign money flowed into sectors that relied on cheap labor rather than those that created high-value jobs or advanced technology.

The findings offer a clear path forward for policymakers. The results indicate that strategies focused solely on creating jobs are insufficient if those jobs are precarious or low-quality. To achieve sustainable growth, policies must prioritize the quality of employment, including stronger labor rights, better social protection, and safer working conditions. The researchers also highlighted the urgent need to address high youth unemployment, noting that the current economic model has struggled to integrate young people into the workforce effectively. By shifting the focus to the quality of work and the skills of the workforce, a country can build an economy that is not only larger but also more resilient and inclusive. The study concludes that the well-being of workers and the prosperity of the nation are deeply intertwined, and that one cannot thrive without the other.