It’s time to target job retention schemes to save jobs that will still be viable

OECD countries have relied heavily on job retention schemes to contain the fallout of the COVID-19 crisis. These schemes slash the cost for employers of keeping workers idle, while protecting their income. By May 2020, the schemes supported about 50 million jobs across the OECD, about ten times as many as during the global financial crisis. This unprecedented take-up has prevented a surge in unemployment and contributed to support aggregate demand. But as countries withdraw restrictions to economic activity, write Alexander Hijzen, Agnes Puymoyen and Andrea Salvatori (OECD), JR schemes need to target jobs at risk that are viable in the medium term.