What should be done about rising unemployment in the oecd

If complemented by measures to diversify educational choices and focused on the acquisition of qualifications that meet business needs, this reform could prove very effective in ensuring that youth leave education with a minimum skill level. Governments are likely to face strong political pressure to offer early retirement and easier access to disability benefits, especially for the older unemployed.

In the past, virtually no workers offered these benefits returned to the labour force when the economy recovered. Such pressure should be resisted. Related Documents Rising informal employment will increase poverty.

The impact was strongest on migrants from Latin America and North Africa. Long-term unemployment has risen sharply among migrants. Cash-strapped governments should avoid cutting systematically on integration programmes, but concentrate on measures that provide the largest pay off, such as language and professional training, and focus on the most vulnerable groups, such as migrant youth, says the OECD.

The report analyses the fiscal impact of immigration. This group faces a high risk of poverty and social exclusion.

Addressing this should be a priority for action by governments. Spending on active labour market policies, such as job-search assistance and training, must be maintained or increased, when possible, to help the unemployed back to work. Since the start of the crisis, such spending has increased, often by more than in previous recessions but not by enough to keep pace with the steep rise in the number of unemployed. Countries cutting the resources available to job-seekers risk making the unemployment situation even worse, and jeopardising the long-term potential for economic growth, warns the report.

Publicly-subsidised work experience could help people keep in touch with the labour market. Targeted subsidies for new hires by employers would have greater impact and be more cost-effective than wide reductions in payroll taxes, says the OECD. There is a growing belief that the recession has run its course and that the goods market has started a period of slow, but sustainable, recovery.

Improvement in the labor market may take some time, but many believe that unemployment will return to its level in the medium term. In this paper, we argue that recovery is by no means guaranteed and that the consequences for unemployment may be worse than anticipated. These necessary cookies are required to activate the core functionality of the website. An opt-out from these technologies is not available.