Roundup: Shipping Prices, the COVID-19 Shock Globally, and Teen Workers

Today, we want to highlight some research recently produced by the St. Louis Fed that you may have missed. The following work was published in the Review and featured in the FRED Blog.

Review

Shipping Prices and Import Price Inflation

During the pandemic, delays and backlogs at ports accompanied unprecedented growth in the cost to ship goods. This article analyzes the extent to which shipping prices contributed to the rise in U.S. import price inflation, which hit levels last seen in the early 1980s. The authors found that the increase in shipping prices has been extreme enough to account for between 3.6 and 5.9 percentage points per year of the post-pandemic rise in U.S. import price inflation.

The Economic Impact of COVID-19 around the World

This article examines the worldwide impact of the COVID-19 pandemic shock on countries, which are grouped by economic development and location. The authors found that, in 2020, the shock severely affected output and employment—particularly in middle-income countries—prompting government responses and disrupting trade globally. Further, the shock’s adverse effect on output and prices was significant and persistent in 2021, especially in emerging and developing countries.

External Shocks versus Domestic Policies in Emerging Markets

Debt crises in emerging markets have been linked to large fiscal deficits, high inflation rates and large devaluations. This article studies a sovereign default model with domestic fiscal and monetary policies to understand Argentina’s experience during the commodity boom following its 2001 default. The authors’ findings suggest that a rise in government spending led to lower output and higher taxation, inflation and currency depreciation, countering favorable terms of trade.

FRED Blog

It’s Only Teenage Workforce

Labor force participation among U.S. teens rose steadily over much of the last decade, recently reaching its highest level since 2009. In contrast, the share of seniors in the U.S. labor force dropped after the pandemic and has shown no sign of recovery. This blog post identifies two trends behind this data: Many older workers left the labor force during the pandemic over health concerns or rising asset values, and a tight labor market has led to more job opportunities for teens.