In the rich world the era of sharp-edged capitalism is giving way to a golden age for labour
In the popular imagination the past four decades were wonderful for the owners of capital and miserable for labour. The rich world’s workers endured competition from trade, relentless technological change, more unequal wages and tepid recoveries from recessions. Investors and companies enjoyed expanding global markets, liberalised finance and low corporate taxes. Even before covid-19, this caricature of broken labour markets was mistaken. Today, as the economy emerges from the pandemic, a reversal of the primacy of capital over labour beckons—and it will come sooner than you think.
It might seem premature to predict a wonderful world of work only a year on from a labour-market catastrophe. But America is showing how rapidly jobs can come back as the virus recedes. In the spring of 2020 the country’s unemployment rate was nearly 15%. Now it is already just 6% after a year containing five of the ten best months for hiring in history. Public perceptions of how easy it is to find a job have already recovered to levels that it took nearly a decade to reach after the global financial crisis. And even in Europe, which is suffering a third wave of infections, the labour market is beating forecasts as economies adapt to virus-containment measures.