Unemployment in OECD-countries

The unemployment rate is a vital indicator of the state of the labour market and an essential measure of economic and social health. It represents the proportion of the working-age population actively seeking employment but unable to find work. This measure not only reflects the number of people without jobs but also highlights the unmet potential in the labour market, where individuals are ready and able to work, but suitable jobs are scarce.

To be classified as unemployed, individuals must meet specific criteria: they must be jobless, available to start work, and have actively sought employment in the past four weeks. The rate is sensitive to changes in labour force participation. During periods of high unemployment, some individuals may become discouraged from continuing their job search, leading them to drop out of the labour force. Such a withdrawal can cause the unemployment rate to decrease or stabilise, which does not necessarily indicate an improvement in labour market conditions.

The OECD data presented below applies this definition uniformly across different countries, ensuring that the unemployment rates are comparable internationally. Moreover, the data is seasonally adjusted to remove the effects of predictable seasonal fluctuations, thereby providing a more accurate reflection of underlying employment trends.

Latest data on unemployment in OECD-countries

The average unemployment rate across OECD-countries stood at 4.9% in February 2024, continuing a trend of remaining stable at below 5% for the past two years. After raising sharply during the pandemic, the average unemployment rate is now hovering around 0.5 percentage points below its pre-pandemic level.

Countries can broadly be classified into three groups, where unemployment rates are either below 5% (low unemployment), between 5% and 10% and above 10% (high unemployment).

Currently, out of OECD-countries Spain, Columbia and Greece are in the high unemployment group. Around half of the OECD-countries have low unemployment rates (below 5%) as per the latest data per country.

A closer at developments over that last year shows a mixed picture, with 20 countries seeing a rise in unemployment over the past 12 months.

The pandemic had large consequences for labour markets around the world, with unemployement rates rising rapidly in many countries. A closer view on how unemployment rates are in early 2024 compared to past years, shows that in countries such as Greece, Italy and Spain all see significantly lower unemployment rates now than before the pandemic. In the United States and United Kingdom, rates are around the same level as before the pandemic. Sweden is one of few “outliers” that are seeing rates having increased compared to before the pandemic.

To explore the data further at country level, the below section charts the monthly unemployment rate over the past five years in all OECD-countries, with the OECD-average drawn as a grey line. Note that as New Zealand and Switerland use quarterly rates, they are shown seperately below.