Unemployment In OECD To Approach 10% In 2010

Unemployment In OECD Countries To Approach 10% In 2010

23 June 2009 - Unemployment in OECD countries will continue to rise well into 2010, with the average unemployment rate approaching 10%, up from 7.8% in April, according to new OECD projections.

More than 57 million people will be unemployed in OECD countries by the end of 2010, according to OECD estimates, up from 37.2 million at the end of 2008, when the average unemployment rate was 6.8%.

The expected increase will bring OECD-wide unemployment to 9.9% at the end of 2010, its highest level since the 1970s, with an average for the year of 9.8%. Unemployment touched a recent low point of 5.5% in the last quarter of 2007, standing at 31.6 million at the end of that year.

“Unemployment will continue to weigh on national economies for a long time to come,” said OECD Secretary-General Angel Gurría. “Previous downturns have taught us that the jobs recovery will lag a long way behind the pickup in economic growth. The OECD is working closely with countries to adapt their policies in order to better help the unemployed and avoid high unemployment levels becoming persistent", he added.

Pending a recovery in labour markets, the OECD says governments should make efforts to help the most vulnerable by ensuring that financial safety nets are adequate for job losers and low-income families and making it a priority to tackle rising youth unemployment.

Greater efforts should be made to provide training opportunities, in order to help people who lose their job stay in contact with the labour market and enhance their skills, the OECD says. For the most hard-to-place unemployed, targeted hiring and the provision of subsidies to help pay for in-job work experience would also help.

Figure 1

Rapid Surge in unemployment in the many OECD countries during the downturn

Changes in unemployment rates and in the number of unemployed, December 2007 - April 2009

Click to enlarge

a. December 2008 for Italy; February 2009 for the United Kingdom; and March 2009 for the OECD average.
b. In May 2009, the unemployment rate in the United States had risen by 4.5 percentages points and in Canada by 2.5 percentage points since December 2007. The number of unemployed persons increased by almost 7 million (92.4 % increase) in the United States and by 391,000 (36.6 % increase) in Canada.
Source : OECD calculations based on the OECD Main Economic Indicators.

For comment or further information, journalists should contact Stefano Scarpetta, head of the OECD’s Employment division (tel. + 33 1 45 24 19 88). The OECD’s latest Economic Outlook with forecasts and analysis for member countries and other major economies, which is the source of these unemployment figures, will be released at 10.30 a.m. Paris time on Wednesday 24 June, 2009.

Journalists wishing to attend the OECD Forum on 23-24 June or the OECD Ministerial meeting on 24-25 June, should register in person at the OECD Conference Centre.

A regularly updated 3-day schedule of media briefings by ministers, Forum participants and OECD experts is available here.

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