Has Unemployment Peaked in Rich Countries?

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PARIS (AP) — 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, the OECD said Wednesday.

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," Gurria said in a news conference to mark the publication by the Organization for Economic Co-operation and Development of the report 'Employment Outlook 2010.'

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

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

Ireland needs to create one job for every five that exist today, or about 320,000 positions, to reach pre-crisis levels and Spain has lost 2.5 million jobs.

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

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 percent 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 loosing contact with the labor 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 says.

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