|Who will float my boat?|
Monday, 10 March 2014
The image of a rising tide lifting all the boats is a picture politicians like to paint – a fair recession and recovery, the reality maybe that the posh yachts and the scruff dinghies may be okay but the smartly kept but modest day boats may be stuck in the mud for a while yet!
Five years after the Great Recession there is a sense that the world’s economy no longer adheres to normal rules, the tide is moving in a mysterious way. In a recession wages are meant to be sticky and as a result of this unemployment rises sharply as workesr price themselves out of the market. Following a recession, typically, productivity and wages pick-up quickly and eventually unemployment should fall. This time around rates of employment have remained quite high through the recession, wages and earnings have fallen sharply and productivity has not bounced back; so why?
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