Unemployment declined in March, dipping to 5.1 percent across OECD economies as the latest figure marks the eleventh straight month of reductions and the lowest level since the OECD began compiling this series in 2001. The improvement is noteworthy because it comes while the overall job market remains below the pre-pandemic pace, with February 2020 registering 5.3 percent and many economies continuing to close the gap as activity rebounds. Across the OECD, unemployment has fallen to levels that are two-thirds lower than before the pandemic, and in several member countries the rate is now roughly half of what was observed in February of the pandemic year, underscoring a broad-based recovery that has touched multiple sectors and regions. The trend reflects resilience in hiring, stronger labor demand, and ongoing policy support that helped sustain workers through the disruption, even as some structural shifts in labor markets persist and require continued attention [OECD].
In March, the decline in unemployment was observed across all age groups and amongst both men and women, signaling a broad-based improvement rather than a short-lived dip tied to specific sectors or demographic cohorts. This widespread easing points to a healthier labor market environment, with increased opportunities across industries and regions. While the euro area posted a slight drop from 6.9 percent in February to 6.8 percent in March, the dynamics varied by country, reflecting differences in industrial structure, labor force participation, and local demand conditions. Mexico stood out with the most pronounced improvement among its peers, slipping from 3.7 percent to 3.3 percent as domestic activity and export dynamics supported job creation in key sectors. In the United States, unemployment moved from 3.8 percent to 3.6 percent, signaling continued strength in hiring as the economy navigates a mix of growth drivers and inflation considerations. Conversely, Turkey experienced a modest uptick from 11.1 percent to 11.5 percent, illustrating how regional shocks or currency dynamics can influence job availability in some environments [OECD, national statistical offices].
Overall, the March data paint a picture of sustained labor market momentum across the OECD while also highlighting the persistent gap relative to the historical low before the pandemic. Policymakers will likely monitor wage growth, participation rates, and industry-specific trends to ensure that the momentum translates into durable gains for workers, including those in vulnerable groups. The interplay between macroeconomic policy, global demand conditions, and sectoral shifts will continue to shape unemployment trajectories in the coming months, with researchers and analysts watching for signs of convergence toward the pre-pandemic employment levels and for any pockets of weakness that could require targeted support [OECD].