Economics

In the News

Post pandemic labour shortages - is the balance of power shifting to workers?

8th June 2021

A story about labour markets, with macroeconomic implications.

John Harris wonders whether the current labour shortages in certain sectors, notably hospitality are going to cause a reconfiguration of the economy, with power shifting in favour of labour, in part as a result of 1.3 million foreign workers leaving the UK.

The net result has been to drive up wages, and make people think about why they work.

And the macroeconomic consequences? Higher inflation, of the cost-push variety.

A shortage of workers is driving up wages: are we entering a new economic era? | John Harris https://t.co/QwixudI0fy
— Guardian Business (@BusinessDesk) June 6, 2021

Fascinating piece by ⁦@johnharris1969⁩ on how labour market shortages are starting to push up wages. Good for low skilled workers, but watch out for inflation (eg. more expensive grocery bills) and the rising interest rates that might result https://t.co/DzqHcvAHME
— Simon Hix (@simonjhix) June 7, 2021

Graham Watson has taught Economics for over twenty years. He contributes to tutor2u, reads voraciously and is interested in all aspects of Teaching and Learning.