In the eurozone, where austerity continues to bedevil recovery attempts in the periphery, the unemployment rate stands a record high of 12.1% and is unlikely to fall until well into next year. The really bad news is that unemployment rates in many eurozone nations is already terrible and likely to get worse. By the end 2014, unemployment is expected to be just over 11% in France, around 12.5% in Italy and close to 28% in Spain and Greece.
There are a few bright spots, of course. In Germany, the current unemployment rate of 5.3% is expected to fall to below 5%, and in the United States the unemployment rate is expected to fall below 7% by the end of 2014.
The heaviest impact has fallen on the young and the unskilled. According to the OECD, unemployment rates among young people topped 60% in Greece, 52% in South Africa, 55% in Spain and around 40% in Italy and Portugal.
The OECD’s prescription does little to assuage the current pain, focusing instead on long-term labor market reform:
Governments should tackle the jobs crisis with a combination of macroeconomic policies and structural reforms to strengthen growth and boost job creation. Over the past few years, a number of countries, including Greece, Italy, Mexico, Portugal and Spain, have introduced ambitious reforms to reduce the gap in employment protection between workers on temporary contracts and those on permanent contracts. These reforms have the potential, if fully implemented, to promote a more inclusive labour market and a better allocation of resources leading to enhanced productivity performance.
Anyone expecting to see an outline for decisive, immediate action in the more than 250 page report will be disappointed. But then, the surprise would have been if the report turned out any other way.