‘Time to Activate Labour Market Policies’, TUAC’s new policy brief, warns that governments are failing workers as investment in active labour market policies hits a two-decade low. OECD data shows spending fell to just 0.41 percent of GDP in 2023, while investment in training for unemployed workers has collapsed by 30 percent since 2010.
More than 34 million people remain jobless across OECD countries, with nearly one in five facing long-term unemployment. Yet employers in healthcare, education, construction and digital industries continue to struggle to fill vacancies – a paradox that well-funded training programmes could help resolve.
At a time when labour markets face major transformation from digitalisation and the green transition, governments are cutting the very programmes that help workers adapt. This is exactly backwards - we need to scale up investment in training, not strip it away.
The decline has been particularly severe in Sweden. Once a global leader in active labour market policy, Sweden slashed training expenditure from nearly 1 percent of GDP in 1992 to just 0.06 percent in 2022. Germany, Denmark, Norway, Canada, Ireland and New Zealand have seen similar reductions.
TUAC argues this disinvestment is economically counterproductive. The policy brief highlights decades of research demonstrating that training programmes deliver strong employment outcomes within two to three years, supporting transitions into better-paid, more productive work. Well-designed programmes also ease labour shortages and reduce inflationary wage pressures.
Trade unions call on governments to significantly expand vocational training, prioritise support for the long-term unemployed, and align programmes with actual labour market needs. With the 2026 public budget cycle underway, governments have a critical opportunity to reverse course.
Read the OECD Forum blog: “Active labour market policies in OECD countries: why renewed investment matters”
Read the TUAC policy brief “Time to Activate Labour Market Policies: Patterns of ALMP Investment Across OECD Countries” (PDF)
