More than five years have now passed since the Lehman shock of September 2008 and its employment consequences are now more visible than ever. At the end of last year, close to 50 million people were unemployed in OECD member countries, about 16 million more than before the crisis broke out. Furthermore, the unemployment rate had been broadly stable for more than two years and improvement is expected to be very gradual.
If there is something to be surprised about in this situation, it is that it is not worse. After all output growth in the advanced countries became extremely weak since 2008 – less than 1 percent per year on average – and employment could have been expected to decline much more.
The employment toll has actually been very large in the U.S., where the employment recession has been of exceptional magnitude, with total employment still about 1 percent below the pre-crisis peak and where the share of adults with a job (what economists call the employment rate) has remained around 58-59 percent since 2009, against 63 percent in 2007. In spite of all U.S. policymakers' fiscal and monetary stimulus efforts, and in spite of the relatively strong U.S. recovery, new jobs added each month only make up for the increase in the working-age population. Put differently, the U.S. along has lost more than 10 million jobs in the crisis.
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Jean Pisani-Ferry
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