A new era of weaker labour supply growth in the UK
After a decade of consistently strong growth, UK labour supply has slumped since the onset of the pandemic and we expect only a partial recovery this year. The drop in labour supply is due to a combination of cyclical and structural factors, primarily virtually zero net inward migration due to the pandemic and a hiatus in the rise in the state pension age.
What you will learn:
- Though immigration should rise now that travel restrictions have eased, strict post-Brexit rules mean it’s unlikely to return to pre-pandemic levels.
- Participation rates, for males particularly, have also dropped.
- But we think this will quickly reverse given that the strong labour market recovery has created plenty of job opportunities and boosted wage growth.
BoK’s monetary policy to tighten even as hiking cycle ends
Even without rate hikes, central banks' monetary policies can effectively tighten if the nominal neutral rate falls below the policy rate. We expect this will be the case for the Bank of Korea this year, as the gap between the policy rate and the nominal neutral rate widens.Find Out More
China: Emerging green shoots in Spring, but not out of the woods
We now incorporate a faster recovery from the post-Covid exit wave and raise our 2023 full-year GDP growth forecast to 4.5% (from 4.2% previously).Find Out More