KOF working papers // Konjunkturforschungsstelle, Eidgenössische Technische Hochschule Zürich 158
The increase in unemployment to relatively high levels for Switzerland in the 1990s gave rise to two fears: First, that economic growth no longer has any effect on employment (jobless growth), and second, that the equilibrium rate of unemployment, i.e. the rate of employment that prevails even in favourable economic conditions, is on an increasing trend. This paper gives an overview of developments on the Swiss labour market since 1980 in order to shed some light on these mentioned anxieties. As far as the relationship between the growth of GDP and employment is concerned, the conclusion is, that it remains fairly strong. However, labour productivity seems to be increasing more rapidly since the beginning of the 1990s, so that the growth of real GDP must be more than 1.8% to bring about an increase in employment. Quantitative estimates of the equilibrium rate of unemployment exhibit a large spread and tend to follow actual rates. Our judgement is, that its increase over time is not very pronounced, and the present value lies in the range of 1.5% to 2%. There does exist a segment of the labour force with specific risks (low education, foreign origin, female) to become and stay unemployed.