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Turkey’s Economic Landscape and the Rise of EoR Services: A 12-Month Statistical Correlation Analysis

Introduction

Over the past year (June 2024 – June 2025), Turkey has experienced a volatile economic environment characterized by high inflation, currency instability, and shifting labor dynamics. Amid these challenges, the Employer of Record (EoR) services sector has gained significant traction as companies seek flexible, compliant, and cost-effective workforce solutions. This blog explores the statistical correlation between Turkey’s macroeconomic indicators and the demand and growth of the EoR services market.


  1. Macroeconomic Overview: Turkey (June 2024 – June 2025)

Turkey’s economy has been under pressure due to structural inflation, political uncertainty, and a weak Turkish Lira (TRY). The key indicators over the last 12 months include:

Inflation rate (YoY): Averaged 55.8%, peaking at ~64.2% in Q4 2024 (Source: TÜİK)

USD/TRY Exchange Rate: Depreciated from 23.7 (June 2024) to ~36.2 (June 2025), a drop of ~52% in value.

Unemployment rate: Increased from 8.9% to 10.6%, as companies reduced full-time hires.

Minimum wage hikes: Saw two increases – 49% in January 2025 and expected mid-year adjustment in July 2025, driving up labor costs.

Net FDI inflow: Declined by 17% YoY, reflecting cautious foreign investor sentiment.


  1. Impact on Traditional Employment Models

The volatility in Turkey’s economic environment has pushed many companies to:

Freeze permanent hires

Delay office expansions

Look for workforce cost optimizations

Reduce headcount or avoid full-time employment liabilities.

As a result, employers—especially foreign companies operating in Turkey—are increasingly turning to EoR models to reduce compliance risk and gain workforce flexibility.

 

  1. EoR Services Sector: Growth and Response

The Turkish EoR market has grown significantly in the last 12 months:

Market size growth: Estimated at +38% YoY from 2024 to 2025 (Source: Global Payroll Association)


Top sectors using EoR in Turkey:

IT and Software Development (42%)

Business Process Outsourcing (18%)

Engineering and Technical Services (12%)

Digital Marketing and E-commerce (9%)


Foreign companies utilizing Turkish talent via EoR: USA, Germany, Netherlands, and UAE remain top origin countries.

Average EoR contract duration: Increased from 7.5 months (2023) to 10.2 months (2025), signaling a shift from temporary to strategic outsourcing.

 

  1. Statistical Correlation: Economic Indicators vs. EoR Demand

To better understand the link between macroeconomics and EoR usage, we evaluated the Pearson correlation coefficient (r) between selected indicators and EoR market data:

 

Indicator     EoR Demand             Correlation (r)                   Interpretation

 

Inflation Rate           +0.78            Strong positive correlation     rising inflation pushes firms                                to adopt more agile hiring

  TRY Depreciation       +0.82         Very strong correlation          foreign clients see Turkish      talent as more cost-competitive

Unemployment Rate  +0.65         Moderate correlation             EoR offers re-entry options for displaced professionals

FDI Decline             -0.42         Weak negative                      EoR services help mitigate risk when greenfield investments pause



Notably, currency depreciation and wage inflation are the two strongest drivers for EoR adoption in Turkey. As Turkish labor becomes more affordable in USD or EUR terms, global companies find EoR a low-risk channel to tap into the market without establishing legal entities.

 

  1. Conclusion: The Strategic Shift to EoR in Turkey

The economic turbulence of the past year has not only reshaped employment practices in Turkey but also accelerated the adoption of EoR services as a strategic solution. This trend is expected to continue into 2026, especially if:

Inflation remains above 40%

TRY continues to depreciate

Regulatory compliance complexity increases (e.g., labor law reforms, tax changes)

In a climate where flexibility, compliance, and speed are more valuable than ever, EoR providers serve as a stabilizing bridge between local talent and global ambition. Turkey is poised to become a regional EoR hub—not despite its economic challenges, but because of them.

 

Sources:

Turkish Statistical Institute (TÜİK)

Central Bank of the Republic of Turkey (CBRT)

Global Payroll Association 2025 Reports

PwC Turkey Labor Outlook (Q2 2025)

OECD Employment Database