Yet we are going through a transition phase out of a very deep crisis, and these downward forces should wane. Indeed, the difference between the headline unemployment rate and broader measures of labour market slack has already edged down in the past two years.
The share of firms that say that labour shortages are limiting their production is at its highest level ever in manufacturing and services. This is translating into higher wage growth now, and in turn contributing to a pick-up in inflation. Various measures of underlying inflation, which is key for 2/5  BIS central bankers' speeches  assessing durability, appear to have turned a corner.