The OECD report shows that economic activity has recovered faster than expected from the pandemic. However, the labour market recovery is still different across sectors and is threatened by the economic fallout from Russia’s aggression against Ukraine.

This generated a humanitarian and economic crisis and raised commodity prices, thus exacerbating the inflationary pressures generated by supply chain disruptions, undermining the strength of the recovery of the labour market.

As the pandemic is not over, it is still shaping the employment dynamics of different industries. The most affected categories are young people and low-skilled, low-paid workers who still trail behind in the recovery in many countries, as well as racial and ethnic minorities.

The report stresses that OECD countries responded to the Covid-19 crisis by complementing employment and social protection measures that effectively supported workers’ jobs and incomes and laid the foundations for a strong labour market recovery.

In this complex context, many governments are taking measures to welcome refugees from the war in Ukraine and offset the significant energy prices increase. Many other measures are under discussion.

It also underlines that policy efforts are required to regulate anticompetitive practices such as wage-setting collusion and non-compete agreements and to rethink other labour market policies, including minimum wages and collective bargaining. Worker-centred policies need to be complemented with firm-oriented policies to tackle wage inequality without adverse effects on employment and output.

Moreover, the analysis of several national legislative reforms and firm-level contractual reductions in hours demonstrated that regular working hours could enhance workers’ well-being without damaging employment and productivity, enhancing well-being with a limited impact on labour cost. Furthermore, promoting flexible working hours could positively affect health, worker satisfaction and work-life balance.

This occurs in contexts where the social partners have leeway to negotiate overall working hours, wages, and work organisation, confirming the importance of strong social dialogue.

Here you can find the analysis of the Employment Outlook 2020, released during the pandemic, to fully understand the critical and rapid changes that have characterised the world of work globally in the last two years.