Now, as investors and policy-makers judge whether pandemic stimulus will end in unwanted inflation, labor markets are sending more downbeat signals on the wage growth that is typically viewed as a prerequisite for sustained price rises.
In the United States, Federal Reserve officials argue that healthy wage growth will be perhaps the most important signal that labor markets are on the mend. For now, the modest U.S. wage growth has become embroiled in a debate over whether there is a labor shortage – a dissonant idea in an economy still 8 million jobs short of where it was before the pandemic.But the more relevant question going forward is whether the pandemic leads to long-term economic scarring or accelerates underlying trends that were already acting as a drag on wages.
“A turnaround in wage settlements is not expected – if at all – until mid-2022 at the earliest,” Commerzbank analysts said in a note, concurring with European Central Bank policy-makers who in their April meeting judged wage pressures to be low. Assuming developed economies continue to recover, it cannot be ruled out that wage pressures will grow as demand for labor grows. But then the question becomes whether wage gains will send prices up as they have tended to in the past.
Philippines Latest News, Philippines Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.