Tight Labor Market Research Articles

Social Responsibility as a Competitive Edge in Tight Labor Markets

Social Responsibility as a Competitive Edge in Tight Labor Markets

Employers and Marginalized Workers’ Experience of Tight Labor Markets

Employers and Marginalized Workers’ Experience of Tight Labor Markets

Understanding Post-Pandemic Surprises in Inflation and the Labor Market

Since the COVID-19 pandemic, the United States has experienced sharply rising then falling inflation alongside persistent labor market imbalances. This Economic Commentary interprets these macroeconomic dynamics, as represented by the Beveridge and Phillips curves, through the lens of a macroeconomic model. It uses the structure of the model to rationalize the debate about whether the US economy can expect a hard or soft landing. The model is surprised by the resiliency of the labor market as the US economy experienced disinflation. We suggest that the model's limited ability to capture this resiliency is a feature of using a linear model to forecast the historically unprecedented movements seen after the pandemic among inflation, unemployment, and vacancy rates. We explain how, by adjusting the model to mimic congestion in a tight labor market and greater wage and price flexibility in a high-inflation environment, as during the post-pandemic period, the model can then capture what has been a path consistent with a soft landing.

Where Exactly are all the First Nation Businesses?

The Yukon has one of the fastest growing, albeit smallest, economies in Canada, with an increasing population and a tight labour market. Modern treaties and self-government agreements have empowered First Nations government and Supreme Court decisions and treaty rights secured Indigenous governments a significant place in the resource sector. Yet Yukon First Nation businesspeople are not yet benefiting fully from this positive political and economic situation. This paper explores the underrepresentation of the Yukon First Nation businesspeople in the economy through an exploration of the available data from the Yukon business survey, census of Canada self-employment data and a new national program at Statistics Canada that is working to better define the presence of Indigenous businesses within the national economy. The research shows that work still needs to be done to better support the development of Indigenous businesspeople as they strive to break through the barriers that have left on the margins of the northern economy.

Where Exactly are all the First Nation Businesses?

The Yukon has one of the fastest growing, albeit smallest, economies in Canada, with an increasing population and a tight labour market. Modern treaties and self-government agreements have empowered First Nations government and Supreme Court decisions and treaty rights secured Indigenous governments a significant place in the resource sector. Yet Yukon First Nation businesspeople are not yet benefiting fully from this positive political and economic situation. This paper explores the underrepresentation of the Yukon First Nation businesspeople in the economy through an exploration of the available data from the Yukon business survey, census of Canada self-employment data and a new national program at Statistics Canada that is working to better define the presence of Indigenous businesses within the national economy. The research shows that work still needs to be done to better support the development of Indigenous businesspeople as they strive to break through the barriers that have left on the margins of the northern economy.

Where have Ukrainian refugees gone? Identifying potential settlement areas across European regions integrating digital and traditional geographic data

AbstractThe escalation of conflict in Ukraine has triggered the largest refugee crisis in Europe since WWII. As of early April 2024, over 5.9 million people have fled Ukraine. Large‐scale efforts have been made to identify the major receiving countries. However, less is known about the subnational areas within host countries where refugees have migrated. Identifying these areas is key for the appropriate allocation of humanitarian aid. By combining digital Facebook API data and traditional data from Eurostat, this paper aims to identify and characterise potential settlement areas of Ukrainians across the main destination countries in Europe. We identify high concentrations of Ukrainians in urban areas with a preexisting diaspora and tight labour market conditions across southern, northern‐west and central Poland and the city of Prague in the Czech Republic. We also find potential settlements in key urban agglomerations with a moderate diaspora and high levels of unemployment in Spain. Only in Romania, refugees seem to have settled in rural areas which show a moderate diaspora but low levels of unemployment. Potential settlement areas in Germany, Italy and the United Kingdom are spread across the country. Surprisingly, we do not identify potential settlement areas in bordering regions with Ukraine within neighbouring countries, suggesting that refugees may have used them as transit points. Our findings point out that different packages of humanitarian assistance may be needed according to the number of refugees and the characteristics of settlement areas.

Learning from others: how insights from healthcare, law, and aviation can inspire accounting education

Dutch accounting education has an excellent reputation; yet future-proofing it is challenged by a tight labour market and the continuously expanding societal roles and expectations imposed on accountants. In this article, we share insights on how three other professions – healthcare, law and aviation – have approached challenges similar to those currently faced by accounting educators. First, we show how healthcare education deals with ever-growing amounts of knowledge that young professionals should master. Second, we share how law educators have developed a new post-graduate approach linking theory and practice. Third, we demonstrate how aviation training fosters competence development without overloading the curriculum.

Can the Phillips curve provide answers to current high inflation rates

Motivated by the weak response of the inflation rate to the tight labor market, the Federal Reserve (Fed) Bank stepped away from its longstanding preemptive policy to fight inflation as the economy approached full employment. This paper aims to reevaluate the relationships of four measures of inflation with the unemployment rate. We accomplish this task by allowing the Phillips curve (PC) slope to vary over time and depend on the magnitude of the unemployment gap. Assessed by both PC convex specification assessment and the Markov chain Monte Carlo (MCMC) estimation method, we confirm the convexity of the PC when the unemployment gap is negative. In addition, we show that the slope of the PC more than doubled when we allow the coefficient on the economic slack to vary over time. Thus, our study shows that PC is still a relevant tool for guiding monetary policy.

The unemployment–inflation trade-off revisited: The Phillips curve in COVID times

Using a New Keynesian Phillips curve, we document the rapid and persistent increase in the natural rate of unemployment, ut∗, in the aftermath of the pandemic and characterize its implications for inflation dynamics. While the bulk of the inflation surge is attributed to temporary supply factors, we also find an important role for current and expected negative unemployment gaps. Through the lens of the model, the 2022–2023 disinflation was driven by the expectation that the unemployment gap will close through a progressive decline in ut∗ and a rise in the unemployment rate. This implies that convergence to long-run price stability depends, critically, on expectations about labor market tightness. Using a variety of cross-sectional data sources we provide corroborating evidence of unusually tight labor market conditions, consistent with our estimated rise in ut∗.

The Federal Reserve’s responses to the post-Covid period of high inflation

In the face of the COVID-19 pandemic in March 2020, the Federal Reserve committed to using its full range of tools to support the U.S. economy. Over the next year and a half, with progress on vaccinations and strong policy support, indicators of economic activity and employment strengthened while inflation moved higher. Faced with a tight labor market and elevated inflation, the Federal Open Market Committee (FOMC) began a process of unwinding the very accommodative stance of monetary policy and moving to a restrictive policy stance to address inflation pressures. Here we review the sequence of actions taken by the Committee between late 2020 and mid-2023 as well as discuss some issues it contemplated along the way; the table provides a chronological list of key events over this period.

The impact of inflation on local government fiscal health

PurposeInflation and federal monetary efforts to control it with interest rate hikes have very real and overwhelmingly negative consequences on US local governments following the onset of COVID-19. This study explores the post-pandemic inflationary environment of US local governments; examines the impacts of inflation and high interest rates on local government revenue, operating costs, capital costs, and debt service; reviews local government inflation management strategies, including the use of intergovernmental revenue; and assesses ongoing threats to local government financial health and financial resilience.Design/methodology/approachThis study uses trend and literature analysis to comment on current issues local governments face.FindingsThe study finds that the growth of property values and resulting stability of property tax revenue has been important to local government revenues; that local governments bear very real burdens as operating and capital costs increase; and that the combination of high inflation and interest rates affects local government debt issuance by negatively affecting credit quality and interest costs, leading to municipal market contraction. Local governments have benefitted tremendously from intergovernmental revenue, but would be ill-advised to rely on it.Practical implicationsVulnerabilities owing from revenue mismatch with the economy; inadequate affordable housing, inequality, and social issues; a changing workforce and tight labor market; climate change; and federal fiscal contraction—all of which are exacerbated by high inflation and interest rates—require local governments to act strategically, boldly and collaboratively to achieve fiscal health and financial resilience, and to realize positive returns of investments in people and capital.Originality/valueThis work is unique in addressing the post-pandemic impact of inflation and interest rates on local governments.

Overcome discrimination for older workers to achieve equality and sustainable development

Transformation of the world population age structure happens at a fast pace and creates problems of increasing social expenditures. However, Industry 4.0 technologies create large-scale opportunities for extending the labor activity of the older population. In Russia, share of people over working age is 22%, and it will increase by another 15% in next 30 years. At the same time, older people are discriminated in the labor market. The article is devoted to the study of job and salary discrimination of elderly workers in the Republic of North Ossetia-Alania as a typical Russian region with tight labor market and a deteriorating demographic situation. Methods of statistical and graphical analysis, factual and sociological research were used. Conclusions have been drawn about the predominance of the model of preserving the employment of older workers in public administration, education, science and health care; the influence of the indexation rate of pensions for non-working pensioners on their informal employment; the preservation of wage disparities for older people employed in the regional economy. The internal gender and age discrimination that has developed in the field of remuneration of older age groups has been revealed: discrimination of women's labor in all age cohorts and types of employment; inter-cohort discrimination of older men's labor within one type of employment; discrimination of wage growth rates of employees of different types of employment. Measures to improve the efficiency of regulating the employment of older workers are proposed.

Nominal Wage Adjustments during High Inflation and Tight Labor Markets

Nominal Wage Adjustments during High Inflation and Tight Labor Markets

Impact of Pay Satisfaction on Employee Engagement and Employee Intention to Turnover

Purpose: The purpose of this research paper was to investigate the impact of pay satisfaction on employee engagement and employee intention to turnover. 
 With the current tight labor market, competition for top talent is fierce. Organizations that can offer competitive pay and benefits packages are more likely to attract and retain the best employees. High turnover rates can be costly for organizations, both in terms of the direct costs of recruiting and training new employees, as well as the indirect costs of lost productivity and customer service. By offering competitive pay, organizations can reduce turnover rates and keep their best employees. Employee engagement is crucial for organizational success. Pay satisfaction is one of the key drivers of employee engagement, so organizations that can offer competitive pay and benefits are more likely to have engaged employees who are more productive and provide higher quality customer service. Design/Methodology/Approach: This study is exploratory study and was conducted on the employees of the five private banks in Mumbai. A sample of 200 employees was randomly selected to study their pay satisfaction, employee engagement and turnover intention. Originality/value The study surveyed impact of pay satisfaction on employee engagement and turnover intentions of employees.

Entangled navigations: Intergenerational care relations in neoliberal eduscapes in Benin

Though often overlooked, parental navigations play an important role in the difficult pathways of rural children through changing eduscapes in northern Benin. Arguing that parents are deeply involved in their children’s trajectories towards making a living, I analyse the care and support parents see themselves as responsible for. A neoliberal and increasingly privatized schooling system creating unequal chances in combination with the demand of ‘Education for all’ responsibilizes parents for their children’s success, and a tight labour market makes it additionally difficult for youth to find positions in the urban space. In consequence, parents are more intensively investing in their children’s education and related costs than ever before, without feeling that these investments lead to what parents value as success. Due to the lack of parental experience in the neoliberal eduscapes and the lack of cultural and social capitals – parents describe it as ‘blindness’ – parental actions in the eduscapes could best be described as navigations which are entangled with those of their children. In these navigations, parents give their children what they never received from their own parents, but also expect or hope them to become what they never were. Both parents and children navigate, I argue, towards an unknown and uncertain future in ‘radical openness’.

Review of “Moving the Needle: What Tight Labor Markets Do for the Poor”

Review of “Moving the Needle: What Tight Labor Markets Do for the Poor”

COVID and Sanctions Resiliency in a Russian Region: The Case of Rostov Oblast 2010–2022

Using convergence estimations, the economies of the towns and districts of Rostov Oblast are shown to be resilient to four shocks to the economy – initial sanctions (2019), initial COVID and continuing sanctions (2020), continuing sanctions and worsening COVID (2021), war, harsher sanctions and declining COVID (2022). Agricultural output is resilient and represents an important growth sector for the Russian economy. Housing and floor area construction are resilient with even gross production being maintained. Labor indicators show a severe shock to unemployment and vacancies in 2020 followed by recovery in 2021 and a much tighter labor market in 2022.

Towards the platformisation of employment in post-pandemic Aotearoa New Zealand? Evidence from the Future Worlds of Work survey

It has been widely recognised in the international literature that the impacts of the pandemic on workers have been experienced unevenly, most severely affecting women, minorities, and those on insecure contracts. At the same time, Covid-19 has accelerated technologically driven developments such as platform work and online freelancing. To provide evidence for these shifts in Aotearoa New Zealand, a survey (n=570) was completed by a sample aged over 18 and employed in the previous 12 months. The survey found uneven experiences of pandemic-related disruption, particularly for those in insecure forms of work, Māori, and frontline workers in hospitality and retail. Further, there was evidence for the emergence of a culture of “digital hustling” among younger people, who are seeking supplementary forms of income from the online world, while 43 per cent of respondents with an employment agreement were required to use a smartphone as part of their job. I use these findings to develop the concept of platformisation, capturing broad impacts of digital technology on workplaces, together with trends towards precarity and individual responsibility. The results have implications for public policy analyses of a “tight labour market” which can negate the unevenly felt effects of an economic slowdown.

The Flow of Vacancies and Unemployment

The U.S. unprecedented tight labor market has been driving inflation pressure since the break of the pandemic. Currently, dropping vacancies is cooling off the labor market. This study analyzes the flow of vacancies and unemployment within the Beveridge relationship during such a period. The Cobb-Douglas matching function is adopted to analyze labor market dynamics. The epilogue of the regressive model finds a proper estimation of the matching function, which the study uses to show that the matching efficiency has worsened since 2022. The study concludes that cooling off the labor market with barely an increase in unemployment is unattainable under the super tight monetary condition.

Analyzing U.S. Macroeconomic

The Federal Reserve's recent movement to control inflation has brought up the most urgent problems for investors. As a result of households accumulating money throughout the early epidemic when they were stuck at home and receiving substantial assistance from the U.S. government, many can now make large purchases. However, the recent lockdowns in China are aggravating supply chain bottlenecks, and the conflict in Ukraine is reducing global food and fuel supplies. Due to this imbalance between supply and demand, the consumer price index is rising. U.S. headline inflation is currently reaching its multi-decade peak, and a tight labor market requires stricter monetary policy to control economic growth.