We expect this trend to continue, dampening prospects for economic growth both in China and, at the margin, the rest of the world (recall that China has accounted for more than a third of global GDP growth over the past 10 years, three times more than the US’s contribution).
Labour shortages are widespread across major economies. Thanks to an ageing population and a shift in attitudes towards immigration, labour shortages are here to stay, with profound implications for the global economy and financial markets.
This trend pre-dates Covid-19 but has undoubtedly been given added momentum by the pandemic.
