|Highland Games Kilts and Boots - Flickr|
Well it turns out that a lof of Europeans including Poles have immigrated to the UK. This should cause massive unemployment, but it has not, why? A study by the Conference Board in the US concludes that western economies like the UK and the USA will soon have a labor shortage due to the retirement of the Baby Boom generation (like me) and not enough new people entering the work force. We will rapidly go from high unemployment to a shortage of workers, as described in this Bloomberg audio interview. The Great Recession delayed this shortage, but the graph below shows the boom in the late 50's, and the fall in birth rates afterwards.
|US Birth Rate|
So what does this mean for us?
- The opportunities to work in retirement will be plentiful
- We could get wage inflation in future
- The US may want immigration in future, legal or not
- Some countries with limited immigration, like Japan and Russia, will suffer this problem sooner and to a greater degree than countries that encourage immigration, like Canada.