OECD Employment outlook points to persisting jobs and inequality crisis


Trade Unions call for action to create quality jobs

The latest issue of the OECD Employment Outlook 2015 is an important reminder of the existing labour market and employment challenges. More importantly, it points to failing policies that need to change.

The slow economic recovery is not closing the massive jobs gap.

The fact that unemployment is predicted to remain unacceptably high, shows that austerity policies and structural reforms that reduce workers’ security are failing to support a job-rich recovery and are leaving low-income households and young people scarred – which we clearly see with the crisis in Greece”, said TUAC General Secretary John Evans.

The Employment Outlook provides evidence that the time has come to revisit policies and conduct a reassessment of the 1984 OECD Jobs Strategy.

The OECD rightly points to the long-term consequences of the jobs and inequality crisis and now needs to act on it.”

The TUAC General Secretary also welcomed the fact that the new Outlook recognises the positive role of minimum wages stating that: “Minimum wages have become indispensable in order to tackle in-work poverty.

That applies in particular to economies where protective labour market institutions have been weakened.

However, social protection schemes and in-work benefits need to be complementary to minimum wage increases – not substitutes to one another”.

Annual real wage growth has slowed in the OECD area since the onset of the crisis, declining from 1.8% during 2000-07 to 0.5%.

Many workers are not able to work a sufficient number of hours to lift them out of poverty. In fact, more people are now in part-time work – up to 20.6% – which reflects a shortage of opportunities for full-time employment.

The Outlook therefore points to an over-reliance on low-paid, low-skilled and temporary jobs.

Young people are suffering most from this situation. To varying degrees, the number of 15-29 year-olds, who are not in employment, education or training (the so-called NEETS), is close to 20 per cent on average in OECD countries.

Young people are over-represented in temporary and other forms of precarious work, which do not provide a pathway to permanent jobs or a source of skills and training for the future.There is clear evidence that youth unemployment has lasting scarring effects on young people at all education levels. This is a tragic waste of potential and undermines trust in our economic and political systems. It is essential to tackle youth unemployment now, and prevent a situation where a whole generation sees its future perspectives permanently diminished by the crisis”, said Evans.

Wage inequality cannot be addressed only by education and skills. Instead, more comprehensive policy packages are needed:

“Even though they have been weakened, labour market institutions, in particular collective bargaining, continue to play a major role regarding wage developments and inequality. There is a pressing need for a broader policy package including collective bargaining to fight poverty and reduce income inequalities and bring people back to work. Activation policies alone are not going to work if there are four up to six times more job seekers than vacancies”, said Evans.

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About John EVANS – General Secretary – Trade Union Advisory Committee to the OECD -

After studying, Philosophy, Politics and Economics at the University of Oxford and teaching Introductory Economics, he worked as an economist in the Economic Department at the Trades Union Congress in London.

Subsequent posts included positions with the International Federation of Commercial, Clerical and Technical Employees (the forerunner of what is now UNI Global Union) in Geneva and the European Trade Union Institute (ETUI) in Brussels.

Since 2012 he also serves as Chief Economist of the International Trade Union Confederation (www.ituc.org) in Brussels.

TUAC and the ITUC together form the secretariat for the L20 that coordinates the labour input to the G20 process.Past not-for profit board positions include the Global Reporting Initiative and the Helsinki Group.

He is currently a member of the Comité Médicis at the Amundi Group, the Conseil d’Orientation of  IDDRI (the French Institute for Research on Sustainable Development) and Council of Ruskin College, Oxford.

He is also currently a member and former Chair of the World Economic Forum Global Agenda Council on Employment/Future of Jobs.