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Global Labor Market Outlook 2019: No End in Sight to Worker Shortages
March 13, 2019 | Report
Which region of the world offers the highest-quality, lowest-wage workers?
It certainly isn’t Central/Eastern Europe: explosive wage growth, negative working-age population growth, and a booming economy mean this region (Bulgaria, Croatia, Czechia, Estonia, Hungary, Lithuania, Latvia, Poland, Romania, Slovenia, and Slovakia) has the most acute labor shortages in the world. In this report, we break down the labor outlook for the rest of Europe, the US, Japan, and emerging markets in Latin America and Asia. Spoiler: labor markets are tight everywhere. We also detail Asia’s winners and losers in the US-China trade war.
In 2019, economic and employment growth is likely to slow down across most mature economies, with the US still growing faster than most other countries. Still, employment is likely to remain strong enough to further tighten the labor market and further accelerate wage growth. Within this overall trend, there is still large variation across countries.
Some countries like Germany, Japan, and the US and broader regions like Central and Eastern Europe are experiencing historically tight labor markets, making it harder for employers to recruit and retain workers, which leads to accelerating labor cost and pressure on profits.
Global labor markets at glance
- Recruiting and retaining top talent was the highest-ranked hot-button issue by CEOs in every region of the world in the C-Suite Challenge™ 2019 survey. The concerns about talent are not just about the immediate future. Lack of sufficient talent is viewed as the top barrier for innovation in 2025.
- A tight labor market will create inflation pressures, to which central banks respond by raising interest rates, which slows economic growth further. One of the main challenges for companies and governments that operate in a tight labor market environment is how to expand the labor force and use technology to reduce the demand for workers.
- Among all regions, the most acute labor shortages are in Central and Eastern Europe. The region is experiencing a brain drain of workers toward richer Western European economies; simultane
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