Belfast Telegraph

Do not abandon the unemployed, governments told

By Lindsay Fergus

Unemployment in rich countries may have peaked but there are still 17 million more people out of work than at the start of the crisis, according to the Organisation for Economic Co-operation and Development (OECD), the economic think tank.

They are "the human cost of the crisis," OECD chief Angel Gurria said, urging governments not to neglect them as they seek to repair wrecked balance sheets.

The longer a person is unemployed, the harder it typically becomes for them to gain paid employment.

"This threatens to mark whole generations," Mr Gurria said launching its report 'Employment Outlook 2010.'

There are 47 million unemployed in the OECD's 31 member countries - the world's most developed economies, a rate of 8.6%, according to May 2010 figures, and compares with 5.8% in 2007.

The United States accounts for more than half of the jobs shed since 2007 - 10 million.

Spain has lost 2.5 million jobs.

Although it said the Republic's economy is stabilising, the OECD believes the Irish labour market will take time to heal after one of the worst recessions in the developed world.

The organisation warned the Republic's recovery will not be vigorous enough to re-employ the 174,000 people who have lost their jobs.

And it voiced fears of a significant risk that discouraged job-seekers could grow permanently disconnected from the labour market

Ireland needs to create one job for every five that exist today, or about 320,000 positions, to reach pre-crisis levels .

During 2007, 2008 and 2009, the OECD said that the number of hours worked in the Republic spiralled by 11.8%.

Unlike other European countries, that was almost entirely due to job losses rather than shorter working hours.

Mr Gurria said deficit cuts should be done extra carefully and governments will "have to do a fine type of surgery instead of using an axe."

He said that governments "could have done better" in designing stimulus measures to prevent job losses.

OECD projections show that the unemployment rate could remain above 8% by the end of 2011.

The Paris-based watchdog advised governments to target their jobs policies on the most disadvantaged groups, and those with few or no skills, who risk losing contact with the labour market.

It recommends tax breaks and hiring subsidies for people out of work for more than a year.

Including those who have given up looking for work or who are underemployed, the number of people looking for work could be as high as 80 million, the report added.

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