A large gap remains in the proportion of people working in Ireland today compared to before the recession while real wage levels have fallen sharply, a report on employment has said.
The Organisation for Economic Co-operation and Development (OECD) found a 7.9 per cent gap in the job rate now and before the financial crisis.
Its employment outlook report for 2016, published on Thursday, found real wages fell sharply during the crises in several countries - the level exceeding 20 per cent in Ireland and Greece.
Real wage growth in the UK, the Czech Republic, Estonia and Latvia, also experienced a sharp deceleration.
“By 2015, real hourly wages in these countries were more than 25 per cent below where they would have been in if wage growth had continued at the rate observed during 2000 to 2007.”
Weak wage growth
Overall, the data shows a continued recovery in labour markets with employment set to return to pre-crash levels by next year, although wage growth remains weak.
The proportion of those aged between 15 and 74 at work will exceed 61 per cent by the end of 2017, just slightly above the 2007 level.
One third of unemployed people have been out of work for 12 months or more, a rise of 54.6 per cent since the end of 2007. More than half of this group has been out of work for two years or longer, increasing the risk they will drop out of the labour force.
The report found that in some countries - Chile, Germany and Turkey in particular - employment has already surpassed pre-crisis levels.
"The job gap with the end of 2007 remains large in some European countries, notably Greece, Ireland and Spain, at 9, 7.9 and 8.5 percentage points respectively."
Productivity growth
Productivity growth was also found to have stagnated in recent years with many workers who lost jobs in manufacturing and construction regaining employment in the services sector but in often lower paid jobs that do not match their skills.
The OECD says there is a need for a better use of skills and further structural reforms to boost productivity, job creation and satisfaction and to raise living standards.
“The job of healing the employment market is only half done,” said OECD secretary general Angel Gurría, at the launch of the report.
“Comprehensive and ambitious policy action is needed to kick start labour productivity growth, raise wages, and reduce rising job market inequalities.”
The report also found a persistence in gender inequality in the labour market with female workers continuing to have “worse jobs” than men.
