23 September 2020 | Fear in the job market
Social measures taken in Europe and supported by the ECB have been very efficient to limit fear of unemployment according to a recent ECB working paper. The US has been less successful in this strategy, with unemployed people forced to accept lower paying jobs. This should, however, help US growth over the next one to three years, as some of these low paid employees will transit back to much higher paying jobs.
What does it mean?
The net outcome of this is that growth might be somewhat better than expected in the United States next year, but is likely to be stronger in Europe in the near term.