What can explain the rise in unemployment?
As I mentioned initially, unemployment was held down in the 1970s and 1980s with an economic policy that was not sustainable in the long term. I believe that this could have concealed structural problems in the labour market that only became visible when the economic policy regime was changed in the early 1990s. If one studies unemployment, particularly total unemployment, over a long period of time, one can see that it has shown a trend increase ever since the end of the 1960s. This also applies if one excludes the years after the change in economic policy regime. Open unemployment did not fall more than to around 4 per cent at the peak of the most recent economic upturn. This also indicates that there are structural problems in the labour market that have also increased over time. There are, for instance, signs that the matching of unemployed and vacancies has deteriorated after the 1990s crisis. Increased globalisation and stiffer international competition, and the ensuing structura
