OECD Warns about High Unemployment

In their report released earlier today the Organisation for Economic Co-operation and Development said the outlook is not good as there is no recovery in sight, and the only positive gains are in temporary jobs which are at best a stop gap measure.

OECD Unemployment

The Employment Outlook 2012 says that the OECD-wide joblessness rate is forecast to remain high at 7.7% in the fourth quarter of 2013, close to the 7.9% rate in May 2012. This leaves around 48 million people out of work across the OECD. In the Euro area, unemployment rose further in May to an all-time peak of 11.1%.

To get employment rates back to pre-crisis levels, about 14 million jobs need to be created in the OECD area. Young people and the low-skilled continue to bear the brunt of the jobs crisis.
Moreover, job creation during the weak recovery of the past two years has often been concentrated in temporary contracts because many firms are reluctant to hire workers on open-ended contracts in today’s uncertain economic environment, says the report.

“The recent deterioriation in the economic outlook is very bad news for the labour market,” said OECD Secretary-General Angel Gurría, presenting the report in Paris. “It is imperative that governments use every possible means at their disposal to help jobseekers, especially young people, by removing barriers to job creation and investing in their education and skills. The young are at most risk of long-term damage to their careers and livelihoods. Targeting the most cost-effective policies is essential.”

The situation varies widely between countries. Unemployment has been rising in the European Union since the end of 2011, but has been stable at around 8.25% in the United States. In OECD countries, the unemployment rate was highest in Spain, at 24.6%, with double-digit rates also in Estonia, France, Greece, Hungary, Ireland, Italy, Portugal and the Slovak Republic.

For the full report visit the OECD

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza