In this case, it did not matter which one was used as a proxy for excess demand; and the unemployment rate could be used interchangeably as a measure of labor market demand pressures and overall economy-wide demand pressures. In the current episode, however, these two measures are sending different signals. The unemployment rate is flashing a warning of a very tight labor market.
Special attention must be paid to the longer-term prospects of the firms that apply for financial assistance. When evaluating and making decisions, banks must take account of technology, organization and the dynamics of firms’ main markets. The Government’s recent initiatives to increase the Guarantee Fund for small and mediumsized firms can strengthen banks’ support to smaller companies.