Économie et Statistique n° 438-440 - Aspects of the crisis
Labour Markets in the Crisis
Since 2007, the global economy has been battered by an economic and financial crisis on a scale unmatched since the Great Depression of the 1930s. A year after the return to positive growth in most countries, economic activity in the developed countries has not yet returned to its pre-crisis level. This collapse triggered a downswing in market-sector employment in the first half of 2008, whose proportions differ according to the country. Overall, with 15 million additional jobless in two years, unemployment in OECD countries has risen twice as fast in this recessionary episode as in the “mildest” previous crises. We analyze the impact of the crisis on the labour market in seven countries: France, Germany, Italy, Spain, United Kingdom, United States, and Japan. The steep rise in unemployment masks a relative resilience in the face of such a severe production shock. The labour-market deterioration could have been far more abrupt in most countries. The main reason for this resilience is the still weak and incomplete impact of the crisis on market-sector employment, often due to greater internal flexibility in firms. It is also explained, in certain countries, by the workforce behaviours that traditionally dampen employment shocks, owing to the discouragement that these induce in a portion of the active population. While we should keep in mind that the available data are still provisional, the conclusion to be drawn from this study is therefore that the crisis is far from over and that five of the countries studied could yet experience a sharp employment adjustment. The prospect of the persistence of such high unemployment therefore raises fears of a growth in long-term unemployment and worsening conditions for young people-the main victims of an economic situation that will leave lasting traces in their working careers.