A study in the Bank of Greece’s Economic Bulletin suggests that wages can increase without causing inflation. The research focuses on labor market dynamics post-pandemic, highlighting that real wages are currently lower than pre-pandemic levels despite productivity growth.
Comparing wage trends in Greece, the EU, and the US, the study reveals that wage growth lags behind productivity in all three regions. While real wages in Greece and the EU remain below pre-Covid levels, the US stands out with no such discrepancy.
The study attributes this disparity to significant government interventions during the pandemic and subsequent energy crises, separating unemployment rates from regular economic cycles.