Although much of the world appears to be emerging from the economic crisis, joblessness is expected to remain high in the US and Europe at least until 2011, the Organisation for Economic Cooperation and Development (OECD) said Thursday.
According to the OECD, “The Indian economy has weathered the global downturn relatively well.” Although poor monsoon rainfall will “modestly hamper” India’s recovery, economic growth is projected to reach over 7 per cent in 2010 and 7.5 per cent in 2011.
“It is only some time down the line that the recovery will become sufficiently strong to reduce unemployment,” the OECD said in its semi-annual Economic Outlook, issued in Paris.
The organisation sees US joblessness dipping to just below 10 per cent in the third quarter of next year and to remain at 9 per cent or higher until the end of 2011.
Unemployment in the Euro area is forecast to rise to nearly 11 per cent next year and to stay at or near that level through 2011.
The OECD predicts that the jobless rate in Japan will fluctuate between 5.5 and 5.7 per cent until the second half of 2011, when it should improve slightly.
The organisation said that the economic upturn in non-OECD countries, “especially in Asia and particularly in China, is now a well-established source of strength” for the relatively weaker recovery among OECD member nations.
“Vigorous growth has resumed in China thanks to a very large monetary and fiscal stimulus,” the OECD said.
Chinese annual GDP growth is projected to exceed 8 percent in 2009 and 10 per cent next year, before easing slightly in 2011 as the impact of the fiscal stimulus ends.
The US economy is forecast to continue to expand gradually, reaching GDP growth of 2.5 per cent next year and 2.8 per cent in 2011.
The OECD expects the euro area’s economic recovery to remain weak, reaching a very modest 0.9 per cent in 2010 and 1.7 per cent the following year.