OECD fears jobless threat to social fabric as Europe left behind
A gloomy cause for reflection on the negative impacts of rural unemployment from the OECD. Lest you think just because we are not in the Eurozone this doesn’t affect us have a chat with someone under 20 near you seeking work in rural England. The article says:
While the US jobless rate will continue falling to 6.7pc by the end of 2014 as recovery takes hold, the rate for the EMU currency bloc will rise to a fresh record of 12.3pc with large pockets of extreme distress.
A trans-Atlantic gap of 5.6 percentage points is unprecedented in modern times and appears to reflect the starkly different policies pursued by the two major blocs since the Lehman crisis.
The OECD listed many measures that can help mitigate the effects of unemployment and ease the way for displaced workers to find new jobs but left no doubt that the real villain is the contractionary policy mix in Europe.
“The main policy priority must be to take action to underpin aggregate demand and boost consumer and investor confidence. Monetary policies have to remain accommodative. The speed of fiscal consolidation should be calibrated to avoid excessive tightening,” it said.
Michael Darda, from MKM Partners, said the great difference between the US and Europe is that bold action by the US Federal Reserve has offset austerity, while the European Central Bank has chosen not to do so. “Monetary policy remains highly relevant,” he said.