More generally we argue that the huge positive labour supply shock to the global economy has made labour so weak that their bargaining power has been significantly reduced. This has meant that the level of unemployment at which inflation starts to accelerate has probably declined quite sharply by several percentage points. To use a technical term, the non-accelerating inflation rate of unemployment (NAIRU) has gone down significantly. For example, the proportionate membership of trade unions in the private sector has declined sharply in most countries. But as labour becomes scarce again, it
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