The dynamics of employment growth in Turkey and the creative destruction during the great recession

In this study, I empirically research the extent to which firms contribute the employment growth and how these contributions changed during the Great Recession. Business Registers dataset (2005-2017) compiled by the Turkish Statistical Institute (TurkStat) was utilized. I found that there is not an inverse relationship between firm size and net job creation contrary to the conventional belief. Moreover, when the firm age is controlled for, I found that only the firms aged up to 2 make a positive contribution to net employment growth. The main source of employment growth in Turkey results from new firm creation. Finally, this study indicates that young large firms were affected hardest by the Great Recession.