About half of the shortfall in labor force participation is attributable to retirements during the pandemic. 1 History suggests that most of those retirees are unlikely to reenter the workforce. But some nonparticipation is due to factors that may fade with time, such as caregiving needs and fear of contracting COVID-19.
Danmarks Nationalbank takes a positive approach to these initiatives and the possibility of accepting them as part of our collateral basis. As far as we can see, larger deposits and other financing have to some extent made their way to some banks under cover of the general government guarantee. Some degree of adaptation must be expected when this guarantee expires.