Table of contents

Foreword 3

Editorial: People to jobs and jobs to people: Reducing regional disparities in the labour market 5

Executive summary 15

1 From resilience to risk: Employment and wages under pressure 18

In Brief 19

Introduction 20

1.1. Labour markets have remained resilient but there have been further signs of weakening 20

1.2. The real wage recovery was already slowing down before the recent surge in energy prices 34

1.3. Young labour market entrants face particular labour market difficulties 54

1.4. Concluding remarks 59

References 60

Annex 1.A. Additional results 64

Notes 78

2 Workers, households, regions: Geographic disparities in labour market outcomes and the distribution of income 82

In Brief 83

Introduction 84

2.1. Regional disparities in labour market outcomes 87

2.2. From labour market outcomes to the distribution of household incomes: Regional

inequalities in living standards 104

2.3. Moving up the ladder: Regional disparities in people’s income mobility 121

2.4. Concluding remarks 124

References 125

Annex 2.A. Sources of data on regional labour market outcomes 134

Annex 2.B. Sources of data on regional income distributions 136

Annex 2.C. Sources of data on regional income mobility 141

Annex 2.D. Regions excluded from the analysis 142

Annex 2.E. Additional results 147

Notes 151

3 Places and people: The impact of structural change on local labour markets 153

In Brief 154

Introduction 156

3.1. Regional specialisation and regional exposure to structural change 157

3.2. The impact of structural change on places, people and firms 167

3.3. Implications for place-based and national policies 182

3.4. Concluding remarks 189

References 190

Annex 3.A. Data sources 196

Annex 3.B. Additional results 197

Notes 199

4 Skills at work: New evidence on returns to skills and training 202

In Brief 203

Introduction 205

4.1. Skills play a key role in shaping labour market outcomes beyond formal education 207

4.2. Training and learning are associated with positive labour market outcomes, particularly in

the case of non-formal training 217

4.3. Fostering skills development and high-return training requires renewed public policies 228

4.4. Concluding remarks 231

References 232

Annex 4.A. Methodological annex 239

Annex 4.B. Robustness checks 240

Notes 243

5 Non-compete and related agreements: Hoarding talent, holding back growth? 244

In Brief 245

Introduction 247

5.1. The economics of non-compete and related clauses 248

5.2. How do OECD countries regulate non-compete clauses? 252

5.3. The incidence and characteristics of non-compete clauses 256

5.4. Non-compete clauses, wages and productivity 276

5.5. Policy discussion 289

5.6. Concluding remarks 292

References 293

Annex 5.A. Survey specifications 300

Annex 5.B. Additional figures and tables 309

Notes 318

6 Recent trends in employment protection legislation: Tackling dualism by harmonising and strengthening regulations 325

In Brief 326

Introduction 327

6.1. Tailored EPL can help labour markets navigate short-term fluctuations and structural

changes in a fair and effective manner 328

6.2. Dismissal regulation for workers on open-ended contracts 331

6.3. Regulation of temporary contracts 339

6.4. Recent reforms in EPL: Harmonising protection of workers on open-ended contracts and strengthening regulation of temporary contracts 347

6.5. Concluding remarks 356

References 357

Annex 6.A. Additional material 363

Notes 376

Annex A. Statistical annex 383