This is a consequence of structural features of euro area labour markets which have been “ratcheting up” unemployment over successive cycles. [12] And it implies that there is a large, latent potential in the euro area labour force which can be unleashed with appropriate labour market and activation policies – and more so than in other advanced economies.
It’s an honor and a pleasure to speak here at the Peterson Institute, a group that has driven much of the most important discussion of international economic issues over my entire working life. I only wish that we could all gather in person—perhaps soon.