Turkish Economy's Last 2 Years: How Minister Simsek's Policies Affected HR and EoR Markets

How Turkey’s Economic Landscape Has Reshaped Recruitment and EoR Markets (2023–2025)

Over the past two years, Turkey's recruitment and Employer of Record (EoR) markets have undergone substantial transformation, directly influenced by macroeconomic instability, regulatory shifts, and evolving labor demands. With inflation control policies taking center stage and GDP growth showing signs of deceleration, employers are reevaluating their workforce strategies. This article explores how these factors have reshaped recruitment dynamics and the increasing reliance on EoR models in Turkey.

Macroeconomic Trends and Labor Market Pressures

In 2023, Turkey recorded GDP growth of 5.1%, slowing from 5.5% in 2022 due to the economic shock caused by the February earthquakes—resulting in damages exceeding $100 billion. By 2024, the economy cooled further, expanding by only 3.2%, as policymakers enforced tighter monetary policies to curb runaway inflation.

Inflation peaked at 86% in late 2022 and has gradually been reined in to 39.1% as of Q1 2025, largely due to aggressive interest rate hikes. While this has stabilized price volatility, it has also constrained domestic consumption and business investment—two key drivers of labor demand.

Although Turkey’s official unemployment rate fell to 8.6% in late 2024 (down from double digits a year earlier), labor force participation has been skewed by a growing number of discouraged workers who have exited the job search altogether. This hidden unemployment presents a more nuanced challenge for HR professionals, especially in sectors experiencing structural shifts.

Shifting Dynamics in Recruitment

The Turkish recruitment landscape reflects a cautious hiring environment. According to GlobalData, active job postings fell by over 25% in January 2025 alone. Employers are focusing on critical roles, prioritizing operational efficiency, and increasingly adopting leaner hiring practices.

Despite the downturn, demand remains strong for tech, e-commerce, and export-driven talent—areas aligned with Turkey’s digitalization and global trade initiatives. Recruitment firms are now required to provide more targeted sourcing, focusing on upskilling and cross-functional adaptability in candidates.

The Growing Role of EoR Solutions

As market conditions grow more volatile, the Employer of Record (EoR) model has emerged as a preferred route for foreign companies entering Turkey, as well as local firms seeking workforce flexibility without additional compliance risk. EoR providers allow businesses to hire employees without establishing a local entity, managing all aspects of employment—from contracts and payroll to tax compliance and benefits administration.

This model has become increasingly attractive amid Turkey’s complex and frequently changing labor laws. The regulatory burden, particularly for foreign enterprises, includes navigating severance liabilities, social security obligations, and evolving tax legislation. By outsourcing these responsibilities to a licensed EoR provider, companies can scale quickly while maintaining full compliance.

Globally, the EoR market is projected to grow from $4.42 billion in 2023 to $8.59 billion by 2030, with Turkey being a strategic growth node due to its youthful labor force, geographic positioning, and cost competitiveness.

Strategic Outlook

Looking ahead, employers in Turkey must continue adapting to economic headwinds by embedding agility into their workforce models. Talent acquisition strategies will need to align with sector-specific growth, while compliance teams must stay abreast of regulatory updates.

EoR services are no longer just an operational workaround—they’re becoming a strategic asset in workforce planning. As companies navigate inflationary pressures, currency fluctuations, and shifting labor market expectations, flexibility and compliance assurance will be key to sustainable growth.