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Redundancy rates in OECD Countries
Hello! Thanks for your question about redundancy rates in OECD countries, with a specific focus on Australia. The short version is that western European countries tend to have lower redundancy rates that other OECD nations, while New Zealand, Australia and the Americas tend to have higher rates. Below you will find a deep dive of my findings, including a methodology and ranked list of countries.
METHODOLOGY
I relied on a combination of OECD data and technical reports to form this report. The latest data on redundancy trends is largely from 2013, although there are newer economic outlook reports with slightly different data. The following list of ranked countries is from OECD data on employment protection, listed in 'OECD Indicators of Employment Protection'. This data is generally accepted as one reputable way to rank the redundancy of employees in an economy. These indicators pull together data on 'strictness of employment protection' in four categories: 1) 'individual and collective dismissals (regular contracts)', 'individual dismissals (regular contracts)', 'temporary contracts', and 'collective dismissals (additional restrictions)'. These indicators are meant to "measure the procedures and costs involved in dismissing individuals or groups of workers and the procedures involved in hiring workers on fixed-term or temporary work agency contracts."
Few current, specific measures of redundancy exist across OECD countries; however, specific measures can be found for some nations. For example, the United Kingdom ranks redundancy as the number of people out of 1000 that have been released from their employment on specific economic grounds, in a specific time period.
OVERVIEW
In general, the US, Sw itzerland, Hong Kong, the Middle East, and Australia have been generally ranked as the places with the highest employee redundancy, while western European countries, especially Italy, France, Germany, and the Netherlands, have been ranked as having the lowest redundancy rates. The following list ranks OECD countries using data on the stringency of employee protection laws as a proxy for redundancy rates; this method is how the OECD currently analyses this topic. Excellent graphics showing these trends can be found in the OECD Employment Outlook report; while several different methods of ranking have been used, it is interesting to note that the order of countries stays relatively the same across these methods.
1. New Zealand
2. United States
3. Canada
4. United Kingdom
5. Chile
6. Australia
7. Estonia
8. Ireland
9. Hungary
10. Japan
11. Switzerland
12. Finland
13. Korea
14. Israel
15. Slovak Republic
16. Spain
17. Norway
18. Denmark
19. Poland
20. Greece
21. Austria
22. Iceland
23. Turkey
24. Sweden
25. Mexcio
26. Czech Republic
27. Slovenia
28. Portugal
29. Luxembourg
30. Italy
31. France
32. Netherlands
33. Belgium
34. Germany
CASE STUDY: AUSTRALIA
In most rankings and by most metrics, Australia has high redundancy rates: one source states that "unlike many other OECD countries, Australia does not have policies in place to limit the number of dismissals for economic reasons". A recent estimate found that 2.3% of Australians lost employment due to downsizing, which likely reflects that in Australia, "...it’s not necessary for employers to justify layoffs" in this context. This, combined with shorter dismissal notice periods, and less strict employment laws in general, mean that Australia has high redundancy rates compared to other OECD nations. A specific description of employment legislation in Australia can be found here.
CONCLUSION
To wrap it up, western European countries tend to have lower redundancy rates that other OECD nations, while New Zealand, Australia and the Americas tend to have higher rates. Thanks for using Wonder! Please let us know if we can help with anything else!