Unemployment and skills from a dynamic perspective

It has been suggested that during the last decades the relative labour market position of the low-skilled has declined markedly, due to a variety of factors. Some authors attribute a substantial part of the explanation of recent European unemployment history to this relative demand shift against the low-skilled. A general increase in skill mismatch is, in their view, one of the main causes of the peculiar persistence that has characterised European unemployment in the past 20 years. This view, however, has not gone unchallenged. Others have argued that the observed persistence is caused by other factors, the incidence of long-term unemployment and everything this brings about, being one of the most important. In this contribution, the two rival views, their microeconomic underpinning and the available empirical evidence as well as the corresponding policy implications are compared.

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The volume from which this chapter is taken is indexed at TD/TNC 66.507. Volumes two and three are indexed at TD/TNC 66.508 and TD/TNC 66.509. Individual chapters from the three volume set are indexed from TD/TNC 66.510 to TD/TNC 66.540.

The first background report, published in two volumes, is indexed at TD/IRD 88.38 and TD/INT 58.286. Show less