This box explores the use of corporate earnings calls as a novel, high-frequency source of data for nowcasting and forecasting labour demand in the euro area. Labour demand has started to show signs of cooling following its post-pandemic peak. By applying textual analysis to transcripts of earnings calls, we construct an indicator that correlates strongly with the euro area job vacancy rate. This metric enables us to produce timely forecasts ahead of official data releases. Utilising a mixed data sampling (MIDAS) regression approach, we use this indicator to forecast the job vacancy rate. We also produce forecasts based on Indeed online job posting data. Our findings indicate a sustained moderation in labour demand, suggesting that the job vacancy rate will hover at around 2.5% through mid-2025. This method makes assessments of labour demand both more timely and more accurate.
Nothing contributes so much to the prosperity and happiness of a country as high profits