The OECD Employment Outlook provides an annual assessment of key labour market developments and prospects in member countries. Each edition also contains several chapters focusing on specific aspects of how labour markets function and the implications for policy in order to promote more and better jobs. This year’s special chapters cover three topics: recent reforms of employment protection legislation; activation policies; and displaced workers. Reference statistics are also included.

Concerns are growing in many countries about the strains that persistently high levels of unemployment are placing on the social fabric. Over five years have passed since the onset of the global financial and economic crisis but an uneven and weak recovery has not generated enough jobs to make a serious dent in unemployment in many OECD countries. In April 2013, 8% of the OECD labour force was unemployed representing over 48 million people, almost 16 million more than in 2007. While there have been some encouraging signs of a recovery in employment growth in the United States, this has been offset by the return of recession in the euro zone with an associated further rise in its unemployment rate to a new record of 12.1% in April 2013. According to the most recent OECD economic projections (May 2013), unemployment in the OECD area is unlikely to fall below its current level until well into 2014.

Over five years have passed since the onset of the global financial and economic crisis and yet unemployment still remains high in many OECD countries. In April 2013, there were over 48 million people out of work, representing an unemployment rate of 8.0%, only half a percentage point below the crisis peak of 8.5%. But there are big variations between countries: unemployment is close to or below 5% in five OECD countries, but exceeds 25% in two others (Greece and Spain). Looking ahead, the OECD projects little change in unemployment for the OECD area through to the end of 2014, with a projected rise by at least a percentage point in six European countries offset by a fall by half a percentage point or more in five other OECD countries.

This chapter assesses recent developments in the labour market situation in OECD countries and discusses the short-term outlook based on the latest OECD projections. A special focus is given to documenting how different socio-economic groups have fared since the start of the global financial crisis. The situation of older workers is analysed in more detail as, unlike for the other groups, they have fared better than in the aftermath of previous major economic downturns. An assessment is also made of whether this improvement for older workers has come at the expense of poorer employment outcomes for youth. This issue is of particular importance given that governments may come under pressure to resort to measures that encourage older workers to withdraw from the labour market in the hope that this frees up jobs for young workers.

This chapter describes the employment protection legislation (EPL) currently in force in OECD countries and selected emerging economies (including all G20 countries). It also presents the latest quantitative estimates of the degree of stringency of EPL, which can be compared across countries. These estimates are the result of a comprehensive effort to update the OECD EPL indicators based on a more accurate collection methodology and taking into account the relevant legislation, collective agreements and case law. This effort has also led to a significant revision of historical time series of these indicators. The chapter also characterises different models of employment protection across OECD countries. In addition, it points to a clear tendency towards reductions of the degree of stringency of employment protection over the past five years, mostly focused on regulations governing individual and collective dismissals.

This chapter provides a comparative review of key developments in the design and implementation of benefit systems, employment and training programmes and employment service arrangements in seven OECD countries. An active orientation of these policies helps to mobilise jobseekers into employment and avoid benefit dependency. The chapter draws on a series of country reviews of activation policies in Ireland, Norway, Finland, Switzerland, Japan and Australia as well as on the preliminary findings from the United Kingdom review. It provides insights into the lessons that can be learnt from the activation policies that have worked in these countries as well as the pitfalls to avoid.

This chapter provides new and more extensive evidence about the incidence of job displacement and its consequences. Job displacement is defined as involuntary job loss due to economic factors such as economic downturns or structural change and particular efforts are made to improve data comparability across the 14 countries included in the analysis. Displacement rates as well as re-employment rates one and two years after displacement are presented in the chapter. The chapter also looks at the effect of displacement on subsequent earnings, as well as some additional aspects of job quality, and explores changes in skill requirements resulting from occupational mobility following displacement. Finally, the groups of workers most affected by displacement – both in terms of its incidence and consequences – are identified.

The statistical annex tables show data for all 34 OECD countries. So far, data available for Brazil, the Russian Federation and South Africa are included in a number of tables.