Meeting of the Members of the Council, 12 April 2013 LATEST LABOUR MARKET DEVELOPMENTS AND SOME POLICY CHALLENGES, MARCH 2013

(1)

Meeting of the Members of the Council, 12 April 2013

LATEST LABOUR MARKET DEVELOPMENTS AND SOME POLICY CHALLENGES, MARCH 2013

John P. Martin Director

Employment, Labour and Social Affairs OECD

Meeting of the Members of the Council

12 April 2013

(2)

Labour market prospects remain grim in the Euro area but some improvement in the United States

Unemployment rates, 2007 Q4-2014 Q4

9 10 11 12 13

Euro area

5 6 7 8 9

OECD area

United States

Japan

2 Shaded area refers to the OECD economic projections.

Source: OECD calculations based on the OECD Economic Outlook Database.

3 4

2007 Q42008 Q1 Q2 Q3 Q4 2009 Q1 Q2 Q3 Q4 2010 Q1 Q2 Q3 Q4 2011 Q1 Q2 Q3 Q4 2012 Q1 Q2 Q3 Q4 2013 Q1 Q2 Q3 Q4 2014 Q1 Q2 Q3 Q4 Japan

(3)

Wide dispersion in unemployment rates and

new record highs have been reached in several countries

Unemployment rates

^a

before the crisis, at its peak

^b

and in 2012 Q4

%

16 20 24 28

Pre-crisis trough Peak 2012 Q4

0 4 8 12

3 Note: Countries are shown in ascending order by the unemployment rate at its peak.

*: Information on data for Israel: http://dx.doi.org/10.1787/888932315602.

a) For Israel, the series have been chained to take into account the break in series in 2012.

b) Trough (peak) dates are defined as the start of the longest spell of consecutive increase (decrease) of the quarterly unemployment rates since 2007 Q4.

Source: OECD calculations based on the OECD Short-Term Indicators Database (Cut-off date: 5 April 2013).

(4)

Employment growth in the recovery has been anaemic and turned negative again in the Euro area

% change (quarter-on-quarter) of non-agricultural dependent employment g (q q ) g p p y

Euro area United States Japan

0 0.5

%1

0 0.5

%1

0 0.5

%1

-2 -1.5 -1 -0.5 0

2 -1.5 -1 -0.5 0

4 -2 -2

Source: OECD estimates based on Eurostat, Quarterly National Accounts, Japan Statistics Labour Force Survey results, and BLS, Current Employment Statistics (Cut-off date: 5 April 2013).

(5)

Employment of youth remains sensitive to the cycle, but that for older workers has become more resilient

Employment rates of youth and older workers, average percentage-point change since start of major economic downturns

since start of major economic downturns

1970s/1980s 1990s Global financial crisis

0 2

% Youth (aged 15-24)

0 2

% Older persons (aged 55-64)

-6 -4 -2

5 Source: Estimations based on national labour force surveys and OECD Economic Outlook Database.

-8

4 8 12 16 -8

4 8 12 16

(6)

Older workers have not crowded out youth during the Global Financial Crisis

Change in youth (aged 15-24) and older workers (aged 55-64)employment rates, 2007 Q4 2012 Q4

^a

2007 Q4-2012 Q4

^a

AUS AUT

BEL

CHL

DNK CZE

FIN FRA

DEU

HUN ISR*

ITA

KOR LUX NLD

POL SVK

SWE EA17 TUR

4 EU27 6 8 10 12

s (aged 55-64) employment rates Correlation: 0.65***

Correlation without ESP, GRC, IRL and PRT: 0.47 ***

CAN

EST FIN

GRC ISL IRL

JPN KOR

MEX

NZL NOR

PRT SVN

ESP

SWE CHE

GBR USA

G7 OECD

-6 -4 -2 0 2

%-points change in older workers

6

*: Information on data for Israel: http://dx.doi.org/10.1787/888932315602

In order to ensure a comparison between the results based on the Quarterly Labour Force Survey and the new Monthly Labour Force Survey introduced in January 2012, the series have been chained using the chaining coefficients provided by the national authorities (For further details see:

http://www1.cbs.gov.il/publications12/saka0412m/pdf/intro_f_e.pdf).

***: Statistically significant at the 1% level.

Source: OECD calculations based on the OECD Short-term labour Market Statistics Database.

GRC -8

-25 -20 -15 -10 -5 0 5

%-points change in youth (aged 15-24) employment rates

(7)

Thank you Thank you

7