The bursting property bubble and a credit crunch lead to more domestic disturbances, more permanent restructuring and uncertainty so that firms are more reluctant and less able to retain staff. BIS central bankers’ speeches  3  Sectoral shocks and reallocation After the crisis, the need for alternative sources of employment has grown.
In particular this is the case in countries such as Spain and Ireland, where the sectoral growth outlook for the hardest hit sector (construction) remains poor. Relocation is a slow process The relocation of surplus labour from permanently downsized sectors to more resilient ones with a better growth potential can be a slow process even in a growing economy.