The Extent of High Unemployment i OECD Countries

(OECD) has recently completed a two-year study of the causes of unemployment and appropriate solutions. The analysis and policy conclusions of this work were endorsed by OECD ministers at their meeting in June 1994. This report does not mince its words about the seriousness of the problem and the challenges it poses. It describes unemployment as: "probably the most widely feared phenomenon of our times. It touches all parts of society."l It points out that: "More than ever since World War 11, today's unemployment is causing damage in ways that cannot be measured by the sheer numbers. High unemployment creates insecurity and resistance to organizational and technical change. Long-term unemploy-ment lowers self-esteem, is demotivating and self-reinforcing, and is associated with health problems. The rise in youth unem-ployment means that many young people are losing skills or employability. Groups in society that have never before faced a high risk of unemployment, such as white-collar workers, are losing jobs, with all the personal and societal costs that implies in terms of lost potential and lost in~estment."~ It then proposes more than sixty policy recommendations to tackle the problem. These recommendations cover a wide range of macroe-conomic and structural policies designed to achieve the twin goals o