OECD unemployment rate down to 7.4% in August 2020

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The FINANCIAL — The OECD unemployment rate fell by 0.6 percentage point in August, to 7.4%, but remained 2.2 percentage points above the level observed in February, before the COVID-19 pandemic hit the labour market. 48.4 million persons were unemployed in the OECD area, 13.5 million more than in February.

Some care is needed in interpreting recent falls in the OECD unemployment rate, as this largely reflects the return of temporary laid-off workers in the United States and Canada, where they are recorded as unemployed.

In the euro area, where temporary lay-offs are not included in unemployment statistics, the unemployment rate continued to increase (to 8.1% in August, from 8.0% in July), with increases of 0.3 percentage point or more in France (to 7.5%), Lithuania (to 9.6%) and Spain (to 16.2%).

In Canada and the United States, headline unemployment rates continued to fall, as ‘temporary lay-offs’ returned to work. In August, the unemployment rate fell by 0.7 percentage point, to 10.2%, in Canada, and by 1.8 percentage points, to 8.4%, in the United States. In September, the unemployment rate continued to fall in Canada (to 9.0%) and the United States (to 7.9%). However, excluding temporary lay-offs from unemployment statistics reveals a similar upward trend in unemployment, since the onset of the pandemic, to that seen in most other countries. On this basis unemployment rates were 3.9 and 1.6 percentage points higher in Canada and the United States in August compared to February.    

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In August, in Japan, the unemployment rate increased to 3.0%, from 2.9% in July, but it decreased by 0.2 percentage point in Mexico (to 5.0%) and by 0.7 percentage point or more in Australia (to 6.8%), Colombia (to 17.5%) and Korea (to 3.2%).

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