- 11 November 2021
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 7, 2021Details
- This box assesses labour supply developments during the COVID-19 pandemic. During the pandemic labour supply has fallen sharply. It has partially recovered, although it remains substantially below pre-pandemic levels. While labour force was initially affected in a similar way across the largest euro area countries, there was also some heterogeneity across countries and demographic groups. When taking the pre-pandemic trends into account, workers with a low and medium level of education as well as older workers explain the largest part of the current gap to the pre-pandemic trends. A full recovery of labour force participation to the rising pre-pandemic trend will likely be gradual.
- JEL Code
- E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles
J11 : Labor and Demographic Economics→Demographic Economics→Demographic Trends, Macroeconomic Effects, and Forecasts
J21 : Labor and Demographic Economics→Demand and Supply of Labor→Labor Force and Employment, Size, and Structure
- 1 February 2021
- ECONOMIC BULLETIN - ARTICLEThe role of demand and supply factors in HICP inflation during the COVID-19 pandemic – a disaggregated perspectiveEconomic Bulletin Issue 1, 2021Details
- The response to the COVID-19 outbreak with lockdowns implies both a shutdown of some markets and a severe economic downturn. Price developments have been influenced in a complex manner by different demand and supply factors, which limits the applicability of past empirical regularities in the interpretation of recent aggregate inflation developments. This article looks at this complexity and applies a component-by-component approach to analysing HICP inflation that takes into account the circumstances prevailing in individual markets. The article analyses how sub-components of euro area inflation have behaved since the onset of the pandemic. It then elaborates on the relative importance of demand and supply factors driving the disaggregated price developments and the implications for headline inflation. The article concludes with the lessons that can be learnt from this bottom-up analysis, an approach that is particularly suited to current circumstances.
- JEL Code
- E21 : Macroeconomics and Monetary Economics→Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy→Consumption, Saving, Wealth
E32 : Macroeconomics and Monetary Economics→Prices, Business Fluctuations, and Cycles→Business Fluctuations, Cycles