Place-based policies for displaced workers: Lessons from past economic disruptions

Oecd

No 2025/04, OECD Local Economic and Employment Development (LEED) Papers from OECD Publishing

Abstract: Global trends such as artificial intelligence, the energy transition, and changing trade patterns are rapidly transforming local labour markets, leading to the displacement of some workers while simultaneously creating new opportunities in emerging sectors. Workforce displacement can have severe and lasting effects on local economies, especially when the decline of a major employer triggers ripple effects throughout supply chains, leading to widespread job losses, rising unemployment, and economic stagnation. If left unaddressed, such disruptions may also weaken social cohesion, drive outmigration, and place additional pressures on local services. Managing the long-term impacts of these disruptions on workers and regions will require thoughtful and targeted policy interventions. Through a literature review and eight international case studies, this paper examines how place-based policies have mitigated the socio-economic challenges of workforce transitions during past economic shocks. By analysing these historical experiences, it aims to provide insights and practical lessons to help policymakers design place-based responses to today's rapidly evolving labour markets. It is part of the broader Transforming Places project.

Date: 2025-06-30
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Persistent link: https://EconPapers.repec.org/RePEc:oec:cfeaaa:2025/04-en

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