Documents Weissler, Marco 5 results

"In the aftermath of the COVID-19 pandemic, the euro area labour market showed remarkable resilience despite weak economic growth and various challenges, including supply chain disruptions, the energy crisis and geopolitical tensions. The relative strength of the labour market compared with economic activity led to a marked decline in measures of labour productivity. Factors such as reduced real wages, increased profit margins, lower average hours worked and strong labour force growth contributed to favourable labour market dynamics, encouraging firms to hire or retain workers. Looking ahead, there are signs of easing in the labour market as some of the factors sustaining employment subside, aligning labour market dynamics more closely with economic activity. Nevertheless, structural issues, such as declining average hours worked and labour force dynamics, may persist."

"Work from home (WFH) patterns have changed substantially following the onset of the coronavirus (COVID-19) pandemic and point to a persistently increased preference for remote work among workers. According to the ECB Consumer Expectations Survey (CES), over 60% of workers had never worked from home before the pandemic, a share that then dropped to below 40% in the months following its onset. Around two-thirds of workers would still like to work remotely at least one day a week after the COVID-19 pandemic ends. Workers' WFH preferences are broadly aligned with the preferences they perceive their employers to have. However, if workers have WFH preferences that exceed those they perceive their employers to have, they are more likely to change jobs. Two key factors affecting workers' WFH preferences are their occupations and commute times."

"One notable recent development in the euro area labour market has been a strong rebound in the labour force. In particular, over the last year and a half, the main source of employment growth has been the strong inflow of people joining the labour force rather than a sharp decline in the number of unemployed. This box provides an overview of recent euro area labour force developments using data from Eurostat and the ECB Consumer Expectations Survey (CES). It also analyses the drivers of the euro area labour force using a mixed-frequency Bayesian vector autoregression (MF-BVAR) to disentangle the push and pull factors behind the labour force dynamics.[1]..."

"Headline and core inflation levels and momentum dynamics in the euro area are currently somewhat weaker than in the United States, reflecting buoyant rent inflation and consumption growth in the United States but also the different cyclical positions of the two economies. Core inflation remains elevated overall in both economic areas, due notably to high levels of services inflation. At the same time, goods inflation has declined considerably, in line with the normalisation of disrupted supply chains at the global level and lower commodity prices. Labour costs started moderating earlier in the United States, with euro area wage growth peaking later and productivity growth being muted by cyclical and structural factors."