Saturday, February 06, 2010
US and UK labour markets - a contrast in flexibility
Posted by David Smith at 10:00 AM
Category: Thoughts and responses

You might have expected the US and UK labour markets to behave similarly in this recession. After all, we are supposed to have similarly "Anglo Saxon" flexible labour markets. The contrast, however, is striking. New figures on Friday revealed a welcome drop in the US unemployment rate from 10% to 9.7% but they also revised up the number of jobs lost in America to 8.4 million, 6% of the workforce.

In contrast, UK employment has dropped by only 642,000, a fraction over 2% of the workforce, despite a bigger officially-recorded drop in UK gross domestic product,