Employment Rates – Population ratio

A look at some varying employment rates across OECD countries.


Source: OECD short term Labour Market stats

Employment rates are determined by the number of people of working age, who have a job.

The employment rate excludes:

  • People who are unemployed. – actively seeking work and willing to take work
  • People who are students
  • People who take early retirement.
  • People on disability or sickness benefits.
  • Parents staying at home to look after their kids.

Implications of Employment Rates

  • A fall in the employment rate to less than 70% is an indicator that the economy is working well below full capacity.
  • The government will be losing out on employment tax revenue
  • The government will be paying more on welfare benefits to support those out of employment.


Employment – Population Ratio

Another issue is the size of the working age population as a % of the total population. For example, Japan has an employment rate of 70% of the working age, but with an ageing population, this is a small % of the total population.


Note: I got these from OECD and then couldn’t find the original source in the OECD stats database. Somehow I’m suspcious of the only 7.7% of the Spanish population working. I know Spain is facing an employment crisis, but it seems too low.

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