But the context of how work is organised and supported with capital is crucially important. If this is true, then a period where the labour market tightens gradually, and not in every area at once, could induce firms to realise that workers are more ‘suitable’ than they previously assumed.
And if they realise that before they start resorting to paying higher wages, the result is that unemployment can fall further before wages start to rise. In other words, the NAIRU falls. And if that is what is happening, it means that learning lags can induce path-dependence in the macroeconomy, in a particularly consequential way.