LATEST LABOUR MARKET DEVELOPMENTS AND POLICY CHALLENGES
Council meeting, 17 December 2014
Stefano Scarpetta Director
Employment, Labour and Social Affairs OECD
Council 17 December 2014
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The labour market impact of the crisis and recovery has been highly uneven across countries
Unemployment rate, percentage of the labour force
Shaded area refers to the latest projections from the OECD Economic Outlook n°96.
Source: OECD Economic Outlook (database), http://dx.doi.org/10.1787/eo-data-en.
3 4 5 6 7 8 9 10 11 12 13
%
OECD area
United States
Japan Euro area (15)
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Labour market conditions also vary within the Euro area
Unemployment rate, percentage of the labour force
0 5 10 15 20 25 30
%
Germany France Portugal
Spain Greece*
Italy
Shaded area refers to the latest projections from the OECD Economic Outlook n°96.
* Series available only on an annual basis.
Source: OECD Economic Outlook (database), http://dx.doi.org/10.1787/eo-data-en.
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Unemployment has started to decline, but further progress is required
Percentage-points change in the unemployment rate since the onset of the crisis (Q4 2007)
Note: Countries shown by ascending order of the maximum unemployment gap (country-specific peak).
a) Aggregate of 15 OECD countries of the euro area.
b) Annual values.
Source: OECD calculations based on OECD Economic Outlook (database), http://dx.doi.org/10.1787/data-00688-en.
-5 0 5 10 15 20
%
Maximum gap
(country-specific peak) Current gap
(Q2 2014) Projected gap
(Q4 2016)
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The jobs recovery is far from complete in a number of countries
Percentage-points change in the employment rate since the onset of the crisis (Q4 2007)
Note: Countries shown by ascending order of the maximum employment gap (country-specific trough).
a) Aggregate of 15 OECD countries of the euro area.
b) Annual values.
Source: OECD calculations based on OECD Economic Outlook (database), http://dx.doi.org/10.1787/data-00688-en.
-12 -10 -8 -6 -4 -2 0 2 4 6 8
%
Maximum gap
(country-specific trough) Current gap
(Q2 2014) Projected gap
(Q4 2016)
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The rise in unemployment since the start of the global financial crisis is largely cyclical, but the structural component has also increased in a number of countries
Percentage-point change during 2008-14
Note: NAIRU: Non-accelerating inflation rate of unemployment. The countries are shown by ascending order of the change in the unemployment rate.
a) Aggregate of 15 OECD countries of the euro area.
Source: OECD calculations based on OECD Economic Outlook (database), http://dx.doi.org/10.1787/data-00688-en.
-5 0 5 10 15 20
%
NAIRU Unemployment Gap
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Severe recessions generate sharp increases in unemployment which are long-lasting and often not
reversed completely in recoveries: Euro area
Actual and projected unemployment rate, percentage of the labour force
B. Euro area
9.1
10.7
9.1
10.0 11.9
4 5 6 7 8 9 10 11 12 13
4 5 6 7 8 9 10 11 12 13
% %
3 years and 9 months
4 years and 3 months
6 years and 6 months 5 years and 9
months 7 years
4 years
1 year and 9 months 2 years
and 6 months
8 years and 6 months
17 years and 3 months 9 years
9 years and 6 months
2 years and 6 months
Dashed line refers to the OECD projections.
a) Aggregated real GDP of 15 countries of the euro area.
Source: OECD calculations based on OECD Economic Outlook (database), http://dx.doi.org/10.1787/eo-data-en.
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Severe recessions generate sharp increases in unemployment which are long-lasting and often not
reversed completely in recoveries: the US
Actual and projected unemployment rate, percentage of the labour force
C. United States
6.0 8.9
10.7
7.6
6.2
9.9
3 4 5 6 7 8 9 10 11
3 4 5 6 7 8 9 10 11
% %
16 years and 3 months 24 years
3 years and 3 months
7 years
5 years and 9 months 2 years
and 3
months 3 years and
6 months 4 years
and 3 months 3 years
and 9 months
8 years and 3 months
10 years and 3 months
5 years 9 years
3 years and 9 months
5 years and 3 months
3 years and 9 months
Dashed line refers to the OECD projections.
a) Aggregated real GDP of 15 countries of the euro area.
Source: OECD calculations based on OECD Economic Outlook (database), http://dx.doi.org/10.1787/eo-data-en.
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