The recent news of a projected rise in unemployment over the next several years is concerning for many, especially those who are directly affected. A new study from the Organisation for Economic Co-operation and Development (OECD) has projected that unemployment in advanced countries is likely to increase by nearly 10 million people between 2020 and 2024.
The news comes at a particularly difficult time, as the COVID-19 pandemic has had significant and profound impacts on economies and labor markets around the world. The OECD’s prediction, which is based on its socio-economic models, suggests that the current surge in unemployment could reach its peak in 2021, before slowly declining throughout the rest of the anticipation period.
The primary cause of this projected unemployment increase is the severe decline in economic activity that has resulted from this pandemic. As lockdowns and other restrictions have been put in place, many businesses have had to close or scale back operations, meaning a large piece of employer-sponsored employment has been lost.
Government policy responses have been swift and wide-ranging, but the OECD predicts their efforts will not be enough to offset the wave of unemployment that is now being predicted. This is concerning news for those looking to remain in the labor market, and could have profound implications for the futures of people in developed nations around the world.
Fortunately, there are also reasons to be hopeful. As of this writing, it is too early to tell how the global economy will recover once the pandemic is contained. Many economists have argued that fiscal spending, especially investment in public services and infrastructure, could be a source of job creation in the near future. Whether such measures are actually taken is yet to be determined, but it is important to hold onto hope all the same that any economic pain brought on by the pandemic will not last for an unnecessarily long time.