Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/259463 
Year of Publication: 
2021
Citation: 
[Journal:] Latin American Economic Review [ISSN:] 2196-436X [Volume:] 30 [Issue:] 1 [Article No.:] 4 [Publisher:] Centro de Investigación y Docencia Económica (CIDE) [Place:] Ciudad de México [Year:] 2021 [Pages:] 1-32
Publisher: 
Centro de Investigación y Docencia Económica (CIDE), Ciudad de México
Abstract: 
Although the unemployment rate is traditionally used to diagnose the current state of the labor market, this indicator does not reflect the existence of asymmetries, mobility costs, and rigidities which impede labor to freely flow over the business cycle. Thus, to get a better portrait of the momentum, we construct the Labor Market Indicator (LMI) focusing on the cyclical similarities of eighteen time series from the Colombian household, industrial, and opinion surveys between 2001 and 2019. Our indicator summarizes the growth cycle of the labor market and its evolution is closely related to the output and unemployment GAP. This indicator is useful for policy analysis as it is useful to forecast headline inflation, it also complements the diagnosis of the current momentum of the labor market, the general economic activity, and the characterization of economic phases and turning points.
Subjects: 
LMI
Colombian labor market
dynamic factor model
unemployment rate
JEL: 
E24
E66
J6
J20
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Article

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