In America the peak in unemployment is receding in the rear-view mirror: the rate in June was 5.9% and the number of vacancies posted by employers is surging
NEARLY A YEAR and a half ago, covid-19 was spreading rapidly across the rich world and countries were starting to lock down. Millions were left unable to work as everything from factories and building sites to shops and restaurants closed. The number of hours worked in the mostly rich economies in the OECD fell by 15%; in the biggest, America, the unemployment rate rocketed from 3.5% in February 2020 to 14.8% in April.
They include those who have been out of work for much of the pandemic. According to the OECD, the number of people who have been unemployed for between six and 12 months has more than doubled across the rich world. Economists argue that the longer someone is out of a job the harder it is for them to find a new one, as their skills and know-how depreciate. Many employees are also still on short-time work schemes, and yet to return to full-time work.
Because covid-19 has hit “customer-facing” industries such as retail and hospitality the hardest, the low-paid and the young have borne the brunt of the crisis, and are more likely to be among the long-term unemployed and the partially employed. For these groups to benefit from the economic recovery, advises the OECD, governments will need to turn their attention away from furlough schemes and towards training and re-skilling programmes.