Wages: OECD sounds the alarm

Wage dynamics are struggling to be felt. While the labor market situation has improved in all OECD countries, this improvement is overshadowed by stagnant wages. " Wage growth remains much more gloomy than before the financial crisis." At the press conference on Wednesday, July 4, OECD Secretary-General Angel Gurria said: that:

"The trend towards a recovery in employment without parallel wage growth highlights not only the structural changes taking place in our economies, that the financial crisis has accentuated and accelerated, but also the imperative need for the countries to support the workers, and more particularly the least qualified of them. "

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[ The Secretary General of the Angel Gurria at a press conference on 12 June. Credits: Michele Tantussi / Reuters. ]

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Sluggish income growth

According to the study of the international institution published on July 4, some indicators relating to the labor market are well in developed countries. In the first quarter of 2018, the average employment rate was two points higher than the highest level reached before the crisis. For the 2018 and 2019 projections, the employment rate and the unemployment rate are expected to improve further. The last indicator should be 5.3% at the end of 2018 and 5.1% by the end of 2019.

However, wage growth "remains significantly lower than it was before the crisis for comparable levels of unemployment " highlights the OECD. Economists explain that expectations of low inflation and slowing productivity, which were very important during the recession, "have not yet fully reversed." The rise of part-time jobs has also played a major role in lower average wage growth.

"The earnings of part-time workers have deteriorated significantly compared to those working full-time, and the part-time work suffered has increased in a number of countries. "

In addition to the weight of part-time jobs in the labor force, the international organization explains that people who have resumed work after a long period of unemployment, "combined with persistently high unemployment rates in some countries, led to an increase in the number of low-wage workers, which slowed average wage growth." precariousness of work in the years following the crisis therefore had a significant impact on workers' incomes.

Favorable prospects for France

For France, the experts at Château de la Muette, the OECD headquarters in Paris, estimate that the unemployment rate should fall further at least until the last quarter of 2019 to fall below the 8% mark . Despite these favorable projections, the unemployment rate is 1.6 percentage points above its pre-crisis low of early 2008 and 3.4 points above the developed country average.

on the wages side, the results are not huge either. Hourly wages increased at a slightly faster rate in France than in average in the 35 member countries of the organization.

"Nevertheless, in a context of persistent unemployment, the rise in wages has been limited since the end of 2012, fluctuating on average around 1% year-on-year. "

Low unionization rate

Report authors point out that collective bargaining can help fight inequality, " while supporting the power of purchasing and improving working conditions. " Despite these possible advances, the organization stresses that France has one of the lowest unionization rates: 11% against 17% on average in the United States. OECD

In addition, the OECD welcomes the reform of unemployment insurance and training, which aims to widen the compensation of the unemployed to individuals and resigners. "This evolution is welcome in a context where career paths are becoming less linear and self-employment progresses." However, the modalities and in particular the list of criteria to open the rights regularly raise debates on the real will of the government to open the device to a wider public.