Assessing labor market conditions in Greece: a note

Salamaliki, Paraskevi (2019): Assessing labor market conditions in Greece: a note.

Abstract

This note uses 18 labor market variables and a dynamic factor model to construct labor market conditions indicators (LMCI) for Greece. The indicators capture common movements among the labor market series and assess improvement of the labor market across a number of dimensions. LMCI changes indicator was deteriorated during the crisis, yet it rebounded back to positive values in late 2013, with speed of improvement being on average much higher compared to the pre-2009 period. Speed of improvement was weakened in early 2015, a period associated with increased political and economic uncertainty. Level LMCI indicator re-exceeded its long-run average 7 years after beginning of the crisis, while its current level is far below levels for the entire sample until 2008. The unemployment rate is found to understate the deterioration and the improvement in labor market conditions in the pre-crisis and the post-crisis period, respectively.

• Item Type: MPRA Paper
• Language: English
• Keywords: Labor market conditions index, dynamic factor model, unemployment rate, factors
• Subjects: C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C32 - Time-Series Models ; Dynamic Quantile Regressions ; Dynamic Treatment Effect Models ; Diffusion Processes ; State Space Models; C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C33 - Panel Data Models ; Spatio-temporal Models; E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy > E24 - Employment ; Unemployment ; Wages ; Intergenerational Income Distribution ; Aggregate Human Capital ; Aggregate Labor Productivity; E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy > E27 - Forecasting and Simulation: Models and Applications

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