Effect of Inflation on Labour Flux: A Study of Pakistan

Abstract

This study explores the complex relationship between labour market dynamics and inflation, providing insight into the various contextual factors affecting the labour market. It explores the implications of inflation on labour demand, salary variations, job search behaviour, inflation expectations, unemployment, and the spillover effects of policy interventions through quantitative analysis of large economic datasets and qualitative insights from surveys and interviews. Economics models such as the Phillips Curve are used to foresee and understand larger economic consequences of research findings. The study has important policy ramifications since it informs decision-makers about financial and labour market reforms. It offers more in-depth understanding of how inflation impacts employment choices, job search activity, and compensation expectations for both individuals and job seekers. In a similar vein, companies learn how inflation affects labour dynamics and job availability, which helps with strategic HR and business choices. This work advances our understanding of macroeconomics and labour economics from an academic perspective. It improves our knowledge of economic cycles and their effects on people, businesses, and the overall economy by closely analysing the inflation-labor transition link. This allows for better decision-making at all levels.