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LAbour market efficiency and increasing employment

5 th Izmir Economic Congress , 30 October to 1 st November 2013. LAbour market efficiency and increasing employment. Stefano Scarpetta Director Directorate for Employment, Labour and Social Affairs OECD.

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LAbour market efficiency and increasing employment

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  1. 5th Izmir Economic Congress, 30 October to 1st November 2013 LAbourmarket efficiency and increasing employment Stefano Scarpetta Director Directorate for Employment, Labour and Social Affairs OECD

  2. The performance of the Turkish labour market in the wake of the global financial crisis

  3. The crisis hit with different patterns of LM adjustment Base 100 in Q4 2007, selected OECD countries Blue shaded areas refer to recession periods. Source: OECD calculations based on Quarterly National Accounts.

  4. Evolution of unemployment rate since the onset of the crisis Unemployment rates, 2007 Q4-2014 Q4 Euro area Turkey OECD area United States Japan Shaded area refers to the OECD economic projections. Source: OECD calculations based on the OECD Economic Outlook Database.

  5. The long-term unemployed now account for one in three unemployed persons in the OECD area Percentage of unemployment,aQ4 2007 and Q2 2013b Note: Countries are shown by ascending order of the incidence of long-term unemployment in Q2 2013. Data are not seasonally adjusted but smoothed using three-quarter moving averages. OECD is the weighted average of 32 OECD countries excluding Chile and Korea. For Israel and Portugal, the series have been chained to take into account the breaks in the LFS series of the years 2012 and 2011, respectively Q4 2011 for Israel. Source: OECD calculations based on the national labour force surveys.(Cut-off date: 8 October 2013).

  6. Youth have been hit particularly hard by the crisis and youth unemployment remains high in most countries Youth unemployment ratesa December 2007-August 2013b • Note: Countries are shown by ascending order of the youth unemployment rate in August 2013. • For Israel, the series have been chained to take into account the break in the LFS series of the year 2012. • June 2013 for Greece, Slovenia, Turkey and the United Kingdom; July 2013 for Chile, Estonia, Hungary and Norway; and 2013 Q2 for New Zealand and Switzerland. • Source: OECD calculations based on the OECD Short-Term Labour Market Statistics Database (Cut-off date: 8 October 2013).

  7. But weak labour market participation for some specific groups is also important … Participation rate by gender and age groups, as a percentage of the population of the indicated group,2012a Countries are ordered by ascending order of the prime-age male labour force participation rates in 2012 . *: Selected urban areas. a) 2009 for Brazil; 2011/12 for India; 2010 for China; 2012 Q3 for Indonesia and first half of 2012 for Saudi Arabia. b) Youth refers to persons aged 16-24 for China, Spain and the United States; Older persons refers to persons aged 55 and over for Indonesia. Source: OECD Labour Force Statistics Database and national labour force surveys.

  8. … however some encouraging improvements for women in Turkey and older persons Change in labour force participation rates, 2007-12a, annual average percentage-points change Countries are ordered by ascending order of the prime-age female labour force participation rates in 2007-12 . *: Selected urban areas. a) 2005-10 for China; 2007/08-2011/12 for India; 2007-09 for Brazil; and 2008-12 for Argentina and South Africa. b) Youth refers to persons aged 16-24 for China, Spain and the United States; Older persons refers to persons aged 55 and over for Indonesia. Source: OECD Labour Force Statistics Database and national labour force surveys.

  9. Labour market difficulties for youth go beyondunemployment a) 2012 Q4 for France, Germany, Ireland, Italy, the United Kingdom and OECD; 2013 Q1 for Canada and the UnitedStates. Source : OCDE (2010), Off to a good start! Jobs for Youth

  10. Toward a polarisation of occupations and competencies The population isincreasinglyeducated in Turkey Proportion of high-skilled in population aged 25-64, 2000-11 Goingforward, employment structure willbecome more similar to the EU Share of employment in 2012 in Turkey and in 2004-08 in the EU-28 Evolution of employment by occupation in Turkey, 2004-12 Percentage of total employment Source: OECD Education Database. Source: OECD calculations based on the Turkish Labour Force Survey and the EULFS.

  11. What are the challenges? • Promote adaptability in the formal labour market: • Turkey score at an intermediate level on the stringency of regulations on permanent contracts, but at the top on temporary contracts. • Greater adaptability of working time can help a great deal in promoting participation of women in the formal economy • Promote closer links between wage adjustments and productivity growth • The employment cost floor set by MW and social security contributions in formal sector is one of the highest compared with median wage. • Companies avoid these costs by employing workers outside the legal system. • The importance of strengthening the responsiveness to the needs of an increasingly dynamic formal sector; • An education system capable of providing the right range of practical professional competences • It is important that these competences are transferable over a work career • The importance of encouraging a move in Turkey towards a life-long learning approach

  12. Thankyou Contact: Stefano.Scarpetta@oecd.org OECD Directorate for Employment, Labour and Social Affairs, via www.oecd.org/els OECD Employment Outlook, via www.oecd.org/employment/outlook OECD Employment database, via www.oecd.org/employment/database OECD Skills Outlook 2013, via www.oecd.org/site/piaac

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