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Mapped: Unemployment Forecasts, by Country in 2023

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Unemployment Forecasts for 2023

Mapped: Unemployment Forecasts, by Country in 2023

This was originally posted on Advisor Channel. Sign up to the free mailing list to get beautiful visualizations on financial markets that help advisors and their clients.

As 2022 clearly illustrated, the global job market can surprise expectations.

So far, this year is no different. The unemployment rate in six of the G7 countries hovers near the lowest in a century. With an unemployment rate of 3.4%, the U.S. jobless rate hasnโ€™t fallen this low since 1969.

But as some economies navigate a strong labor market against high inflation and hawkish monetary policy, others are facing more challenging conditions. In the above graphic, we map unemployment forecasts in 2023 using data from the IMF’s World Economic Outlook.

Uncertainty Clouds the Surface

Across many countries, the pandemic has made entrenched labor trends worse. It has also altered job market conditions.

South Africa is projected to see the highest jobless rate globally. As the most industrialized nation on the continent, unemployment is estimated to hit 35.6% in 2023. Together, slow economic growth and stringent labor laws have prevented firms from hiring workers. Over the last two decades, unemployment has hovered around 20%.

Country / Region2023 Unemployment Rate(Projected)
๐Ÿ‡ฟ๐Ÿ‡ฆ South Africa35.6%
๐Ÿ‡ธ๐Ÿ‡ฉ Sudan30.6%
๐Ÿ‡ต๐Ÿ‡ธ West Bank and Gaza25.0%
๐Ÿ‡ฌ๐Ÿ‡ช Georgia19.5%
๐Ÿ‡ง๐Ÿ‡ฆ Bosnia and Herzegovina17.2%
๐Ÿ‡ฆ๐Ÿ‡ฒ Armenia15.1%
๐Ÿ‡ฒ๐Ÿ‡ฐ North Macedonia15.0%
๐Ÿ‡จ๐Ÿ‡ท Costa Rica13.2%
๐Ÿ‡ง๐Ÿ‡ธ The Bahamas12.7%
๐Ÿ‡ช๐Ÿ‡ธ Spain12.3%
๐Ÿ‡ฌ๐Ÿ‡ท Greece12.2%
๐Ÿ‡จ๐Ÿ‡ด Colombia11.1%
๐Ÿ‡ฒ๐Ÿ‡ฆ Morocco10.7%
๐Ÿ‡ธ๐Ÿ‡ท Suriname10.6%
๐Ÿ‡น๐Ÿ‡ท Turkiye10.5%
๐Ÿ‡ง๐Ÿ‡ง Barbados10.0%
๐Ÿ‡ฆ๐Ÿ‡ฑ Albania10.0%
๐Ÿ‡ต๐Ÿ‡ฆ Panama10.0%
๐Ÿ‡ท๐Ÿ‡ธ Serbia9.7%
๐Ÿ‡ฎ๐Ÿ‡ท Iran9.6%
๐Ÿ‡บ๐Ÿ‡ฟ Uzbekistan9.5%
๐Ÿ‡ง๐Ÿ‡ท Brazil9.5%
๐Ÿ‡ฎ๐Ÿ‡น Italy9.4%
๐Ÿ‡ฐ๐Ÿ‡ฌ Kyrgyz Republic9.0%
๐Ÿ‡จ๐Ÿ‡ป Cabo Verde8.5%
๐Ÿ‡จ๐Ÿ‡ฑ Chile8.3%
๐Ÿ‡ง๐Ÿ‡ฟ Belize8.0%
๐Ÿ‡ต๐Ÿ‡ท Puerto Rico7.9%
๐Ÿ‡บ๐Ÿ‡พ Uruguay7.9%
๐Ÿ‡ฆ๐Ÿ‡ผ Aruba7.7%
๐Ÿ‡ซ๐Ÿ‡ท France7.6%
๐Ÿ‡ต๐Ÿ‡ช Peru7.5%
๐Ÿ‡ธ๐Ÿ‡ป El Salvador7.5%
๐Ÿ‡ธ๐Ÿ‡ช Sweden7.4%
๐Ÿ‡ซ๐Ÿ‡ฎ Finland7.4%
๐Ÿ‡ฒ๐Ÿ‡บ Mauritius7.4%
๐Ÿ‡ช๐Ÿ‡ฌ Egypt7.3%
๐Ÿ‡ฑ๐Ÿ‡ป Latvia7.2%
๐Ÿ‡ณ๐Ÿ‡ฎ Nicaragua7.2%
๐Ÿ‡ฑ๐Ÿ‡น Lithuania7.0%
๐Ÿ‡ฆ๐Ÿ‡ท Argentina6.9%
๐Ÿ‡ช๐Ÿ‡ช Estonia6.8%
๐Ÿ‡ง๐Ÿ‡ณ Brunei Darussalam6.8%
๐Ÿ‡ฒ๐Ÿ‡ณ Mongolia6.6%
๐Ÿ‡ญ๐Ÿ‡ท Croatia6.6%
๐Ÿ‡จ๐Ÿ‡พ Cyprus6.5%
๐Ÿ‡ต๐Ÿ‡น Portugal6.5%
๐Ÿ‡ต๐Ÿ‡ฐ Pakistan6.4%
๐Ÿ‡ต๐Ÿ‡พ Paraguay6.4%
๐Ÿ‡ธ๐Ÿ‡ฐ Slovak Republic6.2%
๐Ÿ‡ฉ๐Ÿ‡ด Dominican Republic6.2%
๐Ÿ‡จ๐Ÿ‡ฆ Canada5.9%
๐Ÿ‡ฆ๐Ÿ‡ฟ Azerbaijan5.8%
๐Ÿ‡ธ๐Ÿ‡ฒ San Marino5.7%
๐Ÿ‡ง๐Ÿ‡ช Belgium5.6%
๐Ÿ‡ท๐Ÿ‡ด Romania5.5%
๐Ÿ‡ซ๐Ÿ‡ฏ Fiji5.5%
๐Ÿ‡ต๐Ÿ‡ญ Philippines5.4%
๐Ÿ‡ฎ๐Ÿ‡ฉ Indonesia5.3%
๐Ÿ‡ฉ๐Ÿ‡ฐ Denmark5.3%
๐Ÿ‡ฑ๐Ÿ‡ฐ Sri Lanka5.0%
๐Ÿ‡ฑ๐Ÿ‡บ Luxembourg5.0%
๐Ÿ‡ฎ๐Ÿ‡ช Ireland4.8%
๐Ÿ‡ฐ๐Ÿ‡ฟ Kazakhstan4.8%
๐Ÿ‡ฌ๐Ÿ‡ง United Kingdom4.8%
๐Ÿ‡ง๐Ÿ‡ฌ Bulgaria4.7%
๐Ÿ‡ฆ๐Ÿ‡น Austria4.6%
๐Ÿ‡ญ๐Ÿ‡ณ Honduras4.6%
๐Ÿ‡บ๐Ÿ‡ธ U.S.4.6%
๐Ÿ‡ง๐Ÿ‡ญ Bahrain4.4%
๐Ÿ‡ท๐Ÿ‡บ Russia4.3%
๐Ÿ‡ง๐Ÿ‡พ Belarus4.3%
๐Ÿ‡ธ๐Ÿ‡ฎ Slovenia4.3%
๐Ÿ‡ฒ๐Ÿ‡พ Malaysia4.3%
๐Ÿ‡จ๐Ÿ‡ณ China4.1%
๐Ÿ‡ฎ๐Ÿ‡ธ Iceland4.0%
๐Ÿ‡ง๐Ÿ‡ด Bolivia4.0%
๐Ÿ‡ญ๐Ÿ‡ฐ Hong Kong SAR4.0%
๐Ÿ‡ณ๐Ÿ‡ฑ Netherlands3.9%
๐Ÿ‡ณ๐Ÿ‡ฟ New Zealand3.9%
๐Ÿ‡ญ๐Ÿ‡บ Hungary3.8%
๐Ÿ‡ณ๐Ÿ‡ด Norway3.8%
๐Ÿ‡ฎ๐Ÿ‡ฑ Israel3.8%
๐Ÿ‡ช๐Ÿ‡จ Ecuador3.8%
๐Ÿ‡ฆ๐Ÿ‡บ Australia3.7%
๐Ÿ‡ฒ๐Ÿ‡ฝ Mexico3.7%
๐Ÿ‡น๐Ÿ‡ผ Taiwan 3.6%
๐Ÿ‡ฒ๐Ÿ‡ฉ Moldova3.5%
๐Ÿ‡ฐ๐Ÿ‡ท South Korea3.4%
๐Ÿ‡ฉ๐Ÿ‡ช Germany3.4%
๐Ÿ‡ฒ๐Ÿ‡น Malta3.3%
๐Ÿ‡ต๐Ÿ‡ฑ Poland3.2%
๐Ÿ‡ธ๐Ÿ‡จ Seychelles
3.0%
๐Ÿ‡ฒ๐Ÿ‡ด Macao SAR2.7%
๐Ÿ‡ฏ๐Ÿ‡ต Japan2.4%
๐Ÿ‡จ๐Ÿ‡ญ Switzerland2.4%
๐Ÿ‡ป๐Ÿ‡ณ Vietnam2.3%
๐Ÿ‡จ๐Ÿ‡ฟ Czech Republic2.3%
๐Ÿ‡ธ๐Ÿ‡ฌ Singapore2.1%
๐Ÿ‡น๐Ÿ‡ญ Thailand 1.0%

In Europe, Bosnia and Herzegovina is estimated to see the highest unemployment rate, at over 17%. It is followed by North Macedonia (15.0%) and Spain (12.7%). These jobless rates are more than double the projections for advanced economies in Europe.

The U.S. is forecast to see an unemployment rate of 4.6%, or 1.2% higher than current levels.

This suggests that todayโ€™s labor market strength will ease as U.S. economic indicators weaken. One marker is the Conference Boardโ€™s Leading Economic Index, which fell for its tenth straight month in December. Lower manufacturing orders, declining consumer expectations, and shorter work weeks are among the indicators it tracks.

Like the U.S., many advanced countries are witnessing labor market strength, especially in the United Kingdom, Asia, and Europe, although how long it will last is unknown.

A Closer Look at U.S. Numbers

Unlike some declining economic indicators mentioned above, the job market is one of the strongest areas of the global economy. Even as the tech sector reports mass layoffs, unemployment claims in the U.S. fall below recent averages. (Itโ€™s worth noting the tech sector makes up just 4% of the workforce).

In 2022, 4.8 million jobs were added, more than double the average seen between 2015-2019. Of course, the pandemic recovery has impacted these figures.

Some analysts suggest that despite a bleaker economic outlook, companies are hesitant to conduct layoffs. At the same time, the labor market is absorbing workers who have lost employment.

Consider the manufacturing sector. Even as the January ISM Purchasing Managers Index posted lower readings, hitting 47.4โ€”a level of 48.7 and below generally indicates a recessionโ€”factories are not laying off many workers. Instead, manufacturers are saying they are confident conditions will improve in the second half of the year.

Containing Aftershocks

Today, strong labor markets pose a key challenge for central bankers globally.

This is because the robust job market is contributing to high inflation numbers. Yet despite recent rate increases, the impact has yet to prompt major waves in unemployment. Typically, monetary policy moves like these takes about a year to take peak effect. To combat inflation, monetary policy has been shown to take over three or even four years.

The good news is that inflation can potentially be tamed by other means. Fixing supply-side dynamics, such as preventing supply shortages and improving transportation systems and infrastructure could cool inflation.

As investors closely watch economic data, rising unemployment could come on the heels of higher interest rates, but so far this has yet to unravel.

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Markets

Mapped: The Growth in House Prices by Country

Global house prices were resilient in 2022, rising 6%. We compare nominal and real price growth by country as interest rates surged.

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The Growth in House Prices by Country

Mapped: The Growth in House Prices by Country

This was originally posted on Advisor Channel. Sign up to the free mailing list to get beautiful visualizations on financial markets that help advisors and their clients.

Global housing prices rose an average of 6% annually, between Q4 2021 and Q4 2022.

In real terms that take inflation into account, prices actually fell 2% for the first decline in 12 years. Despite a surge in interest rates and mortgage costs, housing markets were noticeably stable. Real prices remain 7% above pre-pandemic levels.

In this graphic, we show the change in residential property prices with data from the Bank for International Settlements (BIS).

The Growth in House Prices, Ranked

The following dataset from the BIS covers nominal and real house price growth across 58 countries and regions as of the fourth quarter of 2022:

Price Growth
Rank
Country /
Region
Nominal Year-over-Year
Change (%)
Real Year-over-Year
Change (%)
1๐Ÿ‡น๐Ÿ‡ท Tรผrkiye167.951.0
2๐Ÿ‡ท๐Ÿ‡ธ Serbia23.17.0
3๐Ÿ‡ท๐Ÿ‡บ Russia23.19.7
4๐Ÿ‡ฒ๐Ÿ‡ฐ North Macedonia20.61.0
5๐Ÿ‡ฎ๐Ÿ‡ธ Iceland20.39.9
6๐Ÿ‡ญ๐Ÿ‡ท Croatia17.33.6
7๐Ÿ‡ช๐Ÿ‡ช Estonia16.9-3.0
8๐Ÿ‡ฎ๐Ÿ‡ฑ Israel16.811.0
9๐Ÿ‡ญ๐Ÿ‡บ Hungary16.5-5.1
10๐Ÿ‡ฑ๐Ÿ‡น Lithuania16.0-5.5
11๐Ÿ‡ธ๐Ÿ‡ฎ Slovenia15.44.2
12๐Ÿ‡ง๐Ÿ‡ฌ Bulgaria13.4-3.2
13๐Ÿ‡ฌ๐Ÿ‡ท Greece12.23.7
14๐Ÿ‡ต๐Ÿ‡น Portugal11.31.3
15๐Ÿ‡ฌ๐Ÿ‡ง United Kingdom10.0-0.7
16๐Ÿ‡ธ๐Ÿ‡ฐ Slovak Republic9.7-4.8
17
๐Ÿ‡ฆ๐Ÿ‡ช United Arab Emirates
9.62.9
18๐Ÿ‡ต๐Ÿ‡ฑ Poland9.3-6.9
19๐Ÿ‡ฑ๐Ÿ‡ป Latvia9.1-10.2
20๐Ÿ‡ธ๐Ÿ‡ฌ Singapore8.61.9
21๐Ÿ‡ฎ๐Ÿ‡ช Ireland8.6-0.2
22๐Ÿ‡จ๐Ÿ‡ฑ Chile8.2-3.0
23๐Ÿ‡ฏ๐Ÿ‡ต Japan7.93.9
24๐Ÿ‡ฒ๐Ÿ‡ฝ Mexico7.9-0.1
25๐Ÿ‡ต๐Ÿ‡ญ Philippines7.7-0.2
26๐Ÿ‡บ๐Ÿ‡ธ United States7.10.0
27๐Ÿ‡จ๐Ÿ‡ฟ Czechia6.9-7.6
28๐Ÿ‡ท๐Ÿ‡ด Romania6.7-7.5
29๐Ÿ‡ฒ๐Ÿ‡น Malta6.3-0.7
30๐Ÿ‡จ๐Ÿ‡พ Cyprus6.3-2.9
31๐Ÿ‡จ๐Ÿ‡ด Colombia6.3-5.6
32๐Ÿ‡ฑ๐Ÿ‡บ Luxembourg5.6-0.5
33๐Ÿ‡ช๐Ÿ‡ธ Spain5.5-1.1
34๐Ÿ‡จ๐Ÿ‡ญ Switzerland5.42.4
35๐Ÿ‡ณ๐Ÿ‡ฑ Netherlands5.4-5.3
36๐Ÿ‡ฆ๐Ÿ‡น Austria5.2-4.8
37๐Ÿ‡ซ๐Ÿ‡ท France4.8-1.2
38๐Ÿ‡ง๐Ÿ‡ช Belgium4.7-5.7
39๐Ÿ‡น๐Ÿ‡ญ Thailand4.7-1.1
40๐Ÿ‡ฟ๐Ÿ‡ฆ South Africa3.1-4.0
41๐Ÿ‡ฎ๐Ÿ‡ณ India2.8-3.1
42๐Ÿ‡ฎ๐Ÿ‡น Italy2.8-8.0
43๐Ÿ‡ณ๐Ÿ‡ด Norway2.6-3.8
44๐Ÿ‡ฎ๐Ÿ‡ฉ Indonesia2.0-3.4
45๐Ÿ‡ต๐Ÿ‡ช Peru1.5-6.3
46๐Ÿ‡ฒ๐Ÿ‡พ Malaysia1.2-2.6
47๐Ÿ‡ฐ๐Ÿ‡ท South Korea-0.1-5.0
48๐Ÿ‡ฒ๐Ÿ‡ฆ Morocco-0.1-7.7
49๐Ÿ‡ง๐Ÿ‡ท Brazil-0.1-5.8
50๐Ÿ‡ซ๐Ÿ‡ฎ Finland-2.3-10.2
51๐Ÿ‡ฉ๐Ÿ‡ฐ Denmark-2.4-10.6
52๐Ÿ‡ฆ๐Ÿ‡บ Australia-3.2-10.2
53๐Ÿ‡ฉ๐Ÿ‡ช Germany-3.6-12.1
54๐Ÿ‡ธ๐Ÿ‡ช Sweden-3.7-13.7
55๐Ÿ‡จ๐Ÿ‡ณ China-3.7-5.4
56๐Ÿ‡จ๐Ÿ‡ฆ Canada-3.8-9.8
57๐Ÿ‡ณ๐Ÿ‡ฟ New Zealand-10.4-16.5
58๐Ÿ‡ญ๐Ÿ‡ฐ Hong Kong SAR-13.5-15.1

Tรผrkiyeโ€™s property prices jumped the highest globally, at nearly 168% amid soaring inflation.

Real estate demand has increased alongside declining interest rates. The government drastically cut interest rates from 19% in late 2021 to 8.5% to support a weakening economy.

Many European countries saw some of the highest price growth in nominal terms. A strong labor market and low interest rates pushed up prices, even as mortgage rates broadly doubled across the continent. For real price growth, most countries were in negative territoryโ€”notably Sweden, Germany, and Denmark.

Nominal U.S. housing prices grew just over 7%, while real price growth halted to 0%. Prices have remained elevated given the stubbornly low supply of inventory. In fact, residential prices remain 45% above pre-pandemic levels.

How Do Interest Rates Impact Property Markets?

Global house prices boomed during the pandemic as central banks cut interest rates to prop up economies.

Now, rates have returned to levels last seen before the Global Financial Crisis. On average, rates have increased four percentage points in many major economies. Roughly three-quarters of the countries in the BIS dataset witnessed negative year-over-year real house price growth as of the fourth quarter of 2022.

Interest rates have a large impact on property prices. Cross-country evidence shows that for every one percentage point increase in real interest rates, the growth rate of housing prices tends to fall by about two percentage points.

When Will Housing Prices Fall?

The rise in U.S. interest rates has been counteracted by homeowners being reluctant to sell so they can keep their low mortgage rates. As a result, it is keeping inventory low and prices high. Homeowners canโ€™t sell and keep their low mortgage rates unless they meet strict conditions on a new property.

Additionally, several other factors impact price dynamics. Construction costs, income growth, labor shortages, and population growth all play a role.

With a strong labor market continuing through 2023, stable incomes may help stave off prices from falling. On the other hand, buyers with floating-rate mortgages face steeper costs and may be unable to afford new rates. This could increase housing supply in the market, potentially leading to lower prices.

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