Inflation and employment: Exploring the dynamic relationship in the labor markets

Abstract

This paper explores the dynamic relationship between inflation and employment in different labor market sectors. The paper uses data from the Bureau of Labor Statistics and the Consumer Price Index and applies descriptive statistics, correlation analysis, and multiple regression analysis to examine the relationship between these two economic indicators. The paper finds that inflation and employment have a negative relationship in the short term but a positive relationship in the long term and that the relationship varies across different labor market sectors. The paper contributes to the literature on the relationship between inflation and employment by considering sectoral differences and temporal dynamics. The paper also provides policy implications for managing inflation and employment trade-offs.

Keywords

• economic development
• economic growth
• economics