Labour force participation

Labour force participation rates in 2019 were on average somewhat lower in OECD countries (61.4%) than in Asia/Pacific countries (63.2%), (see Figure 3.1). In 2019, the highest labour force participation rates were recorded for Nepal, Cambodia and Korea DPR at over 80%, while these were below 50% in India, Papua New Guinea, Tonga, Samoa and Tajikistan.

There is a gender gap in labour force participation rates. On average across the region labour force participation rates were 74% for men and 53% for women in 2019. In that year, gender labour force participation rate gaps exceeded 40 percentage points in Bangladesh, India, the Maldives and Sri Lanka, and at 60 percentage points was largest in Pakistan. The smallest gender gaps in favour of men (1 to 2 percentage points) were recorded for Papua New Guinea – where labour force partition rates were 47% and Nepal, which with 82.5% recorded the highest labour force participation rate of the region.

Looking ahead, OECD projections (Figure 3.2) show that – if male and female labour participation rates by five-year age groups follow the “baseline” scenario – the labour force will decrease substantially in Japan (from peak of 67 million in 2019), China (from peak of 805 million in 2020) and Korea (from peak of 28.3 million in 2025). In contrast, Australia, India and Indonesia are projected to experience an increase in the size of the labour force over the next few decades. G20 countries have committed to reduce the gender gap in labour force participation rates. This scenario would have a significant effect on the size of the labour force in several countries, especially in India, where female labour force participation rates are currently low, the labour force could potentially double by 2060.

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