Overview of Unemployment Rates Across OCDE Countries
The Organisation for Economic Co-operation and Development (OCDE) released a report analyzing the unemployment rates of its member countries during March. Spain, Colombia, and Finland lead the pack with the highest unemployment rates. Meanwhile, Mexico, Japan, and the Czech Republic had the lowest unemployment rates.
The overall unemployment rate remained stable at 4.9% in March, according to the OCDE.
Countries with Highest Unemployment Rates
- Spain: Unemployment rate was 10.9% in March, the highest among OCDE countries.
- Colombia: Second highest with a rate of 9.6%.
- Finland: Third highest with a rate of 9%.
- Greece: Fourth highest with a rate of 9%.
- Estonia: 8.7%
- Sweden: 8.1%
- Turkey: 7.9%
- France: 7.3%
- Denmark: 7.1%
- Canada: 6.7%
- Latvia: 6.7%
- Portugal: 6.5%
Reasons for High Unemployment in Colombia
Camilo Cuervo, a partner at Holland & Knight, explained that Colombia’s loss of competitiveness compared to other markets is the primary reason for its high unemployment rate. Social and political phenomena in Colombia, driven by President Gustavo Petro’s government, have negatively affected foreign investment in the country.
“Colombia has become less attractive for businesses due to the social and political focus on the country, driven by President Petro’s government. There is significant uncertainty regarding the management of the country and labor condition modifications, causing businesses and foreign investment to leave Colombia,” Cuervo said.
Colombia’s high overstaffing and labor costs are also factors, with these costs disguised as social benefits and additional payroll expenses. These costs are among the highest in Latin America when considering vacation days, premiums, and social security contributions.
Countries with Lowest Unemployment Rates
Mexico, Japan, and the Czech Republic had the lowest unemployment rates at 2.5%, 2.5%, and 2.6%, respectively. Other countries with low unemployment rates include South Korea (2.9%), Israel (2.9%), Slovenia (3.2%), Germany (3.5%), the Netherlands (3.9%), Ireland (4%), Australia (4.1%), the United States (4.2%), and Hungary (4.2%).
In the United States, despite a calmed tariff war due to agreements with China, there is optimism about unemployment figures. Federal Reserve Governor Adriana Kugler stated that the US labor market is stable and likely to approach the central bank’s maximum employment target.
Jerome Powell, FED president, acknowledged that Trump’s tariffs might increase unemployment and inflation but haven’t affected official US government numbers. In Canada, the unemployment rate rose from 6.9% to 6.7% in February.
In the European Union and the eurozone, unemployment rates remained stable at historic lows of 5.8% and 6.2%, respectively, for the sixth consecutive month. The report states that unemployment remained stable in three-quarters of the 17 OCDE countries in the eurozone, while it decreased slightly in Latvia and Lithuania. It increased in Finland and Greece.
Unemployment Rates by Gender and Age
The unemployment rate for both genders remained stable at 5.1% and 4.7%, respectively. Women’s unemployment rate surpassed that of men in the European Union, the eurozone, and 20 OCDE countries.
In 17 OCDE countries, including all G7 nations except Italy, men’s unemployment rate exceeded that of women. In South Korea, the rates were equal for both genders.
“The OCDE unemployment rate remained stable for workers aged 15 to 24, at approximately 11.1%, which is about seven percentage points higher than the stable rate for workers aged 25 or older,” explained the report.
Regarding Finland’s position as a developed economy, Cuervo stated that it might be more expensive for labor generation compared to other countries.
Colombia ranks low in the OCDE’s well-being at work index, according to a study analyzing work-life balance in the 60 largest economies worldwide. The ranking, published by Remote, placed Colombia 40th out of 40 countries, with New Zealand, Ireland, and Belgium ranking first, second, and third, respectively.
