OECD Makes Gloomy Job Prediction

The Organisation for Economic Cooperation and Development aims to provide a forum where governments can cooperate towards improving the economic and social well-being of the world’s people which is OECD’s mission. Their current focus is on four areas and does a good job of summarising current global problems:
• First and foremost, governments need to restore confidence in markets and the institutions and companies that make them function. That will require improved regulation and more effective governance at all levels of political and business life.
• Secondly, governments must re-establish healthy public finances as a basis for future sustainable economic growth.
• In parallel, we are looking for ways to foster and support new sources of growth through innovation, environmentally friendly ‘green growth’ strategies and the development of emerging economies.
• Finally, to underpin innovation and growth, we need to ensure that people of all ages can develop the skills to work productively and satisfyingly in the jobs of tomorrow.
OECD has just issued its annual Employment Outlook report which makes gloomy reading for young people and unskilled workers. It is predicting that unemployment will continue to hit these two groups hardest. As a whole, it predicts that unemployment will fall from 8% to 7.8% across the 34 OECD member countries during the next 18 months. Within Europe the unemployment picture will continue to be patchy. German unemployment should dip from its current level of 5.3% to drop under the 5% mark, but in other EU states it expects the situation to remain stable or worsen slightly. France and Italy are expected to see 11 and 12.5% unemployment respectedly by the end of next year, but Spain and Greece will need to endure nearly 28% unemployment – unless effective changes are implemented in the meantime.

In the USA, unemployment is predicted to ease from 7.6% to 7% by the end of next year which would mean that the Federal Reserve’s accommodative monetary policies will be on tap throughout the next twelve months since the trigger point for starting to withdraw them is that US unemployment needs to be below the 6.5% mark.