Despite the global economy having slowed substantially since 2021, OECD job markets remain tight with employment having fully recovered since the COVID-19 crisis, and unemployment at its lowest level since the early 1970s. While nominal hourly wages have risen, they have not kept up with inflation, leading to a drop in real wages in almost all OECD countries.
The OECD Employment Outlook 2023 projects OECD-wide employment to keep expanding in 2023 and 2024. This May the unemployment rate remained at its record low of 4.8% for the third consecutive month, and the share of temporary contracts and involuntary part-time has declined in most OECD countries. Furthermore, data on online job postings has revealed an increase in the share of vacancies offering employee benefits, such as health-related benefits, retirement programs/schemes and paid time off.
Analysis in the Outlook indicates that profits have often risen more than labour compensation; thus, there is some room for profits to absorb further wage adjustments to recover some of the losses in purchasing power.
The Outlook delves into Artificial Intelligence (AI) and its potential for impacting the labour market. Highlights include the fact it significantly expands the range of tasks that can be automated, that it is a general-purpose technology meaning nearly