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MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
FED
In a note last week, BofA concluded that it could take a long time for the labor force participation rate to return to pre-COVID levels (see 1412ET bullet).
- Of the ~4.6mn workers not in the labor force "due to the pandemic" (which are in addition to the 9.7mn officially reported unemployed), about half "could come back easily" (when unemp insurance runs out / children return to school), but many may be out of the workforce much longer, incl 700K workers who left "due to skills mismatch" and 1.2m aged 65+ who retired. And that doesn't count the estimated 140K which "have sadly been lost due to Covid deaths".
- "Over the next several years, the recent surge in retirements and long run demographic trends are likely to weigh on the participation rate, making it difficult for the labor force participation rate to return to pre-pandemic levels."
- The flipside of that though is "there is notable risk for a quicker drop in the unemployment rate than our current forecast (4.2% YE2021, 3.5% YE2022). Tighter labor market conditions should provide greater support for better trend wage growth in coming quarters."
BofA, citing BLS CPS
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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