If labour productivity continues to stagnate in the euro zone, how much longer can employment and the employment rate keep rising?

Potential growth in the euro zone is the sum of (smoothed) productivity gains, and growth in the population in employment. Growth in the population in employment depends on growth in the working-age population and growth in the employment rate . Since 2018, potential growth has remained positive, despite stagnating productivity and a shrinking working-age population, thanks to a rising employment rate. Which begs the question: if productivity continues to stagnate in the euro zone, how long can potential growth remain positive and significant, thanks to a rising employment rate? We examine employment rate growth in the major OECD countries as a function of their employment rate levels. Comparing OECD countries, we see that there is no stable relationship between the level and the growth rate of the employment rate. Some countries with high employment rates show a stagnation of their employment rate; other countries with high employment rates maintain a sharply rising employment rate. A high level of the employment rate does not necessarily lead to a stagnation of this rate.