Temporary factors that compounded the slowdown in European economic growth in the second half of 2018 are expected to mostly abate going into 2019. Annual growth over 2019 is, however, expected to come in lower than 2018, but domestic demand will stay on track. Labor shortages have stopped rising, but remain elevated, leading to cost pressures especially in Eastern European economies and in general in services industries such as payrolling, transportation, and computer services.