Tight Labor Market Lifts Wages, Stoking Inflation Fears

Last summer, many expected that previously displaced workers would jump right back into work when enhanced and extended unemployment benefits expired. But for a handful of reasons, including fear of COVID exposure and large cushions of accumulated savings, many remained out of the labor force, especially those previously employed in low-paying sectors such as leisure and hospitality and retail, which typically involve high levels of face-to-face contact.

-CoStar Economy is produced weekly by Christine Cooper, managing director and chief U.S. economist, and Rafael De Anda, associate director of CoStar Market Analytics in Los Angeles.