Aitor Irastorza-Fadrique

New at JIE: "Household responses to trade shocks" by Aitor Irastorza-Fadrique (@aitor-if.bsky.social), Peter Levell (@peterlevell.bsky.social), Matthias Parey

doi.org/10.1016/j.ji...

The University of the Basque Country (@ehu.eus) is hosting the 2026 EAYE Annual Meeting.

2026ko EAYE konferentzia Euskal Herriko Unibertsitatean izango da. Artikuluak bidaltzeko epea zabalik dago, abenduaren 1era bitarte. Informazio guztia hemen: www.eaye.info/eayeam/2026-...

EVENT: IFS recruitment event 2025

Wednesday 1 October | 5pm – 6pm | Online via Zoom

Want to work at IFS? Join our recruitment event to meet our staff, ask questions about life at IFS and find out more about our hiring process.

➡️ Find out more and sign up here: ifs.org.uk/events/ifs-r...

"AI is probably more impactful for employment even than the Dot-com revolution of the nineties. This is more like the industrial revolution of the 19th century"

Sir Philip Augar discusses the impact of AI on the labour market.

🎧 Listen here: ifs.org.uk/articles/are...

🌍 Thank you for joining us at the 21st EUROFRAME Conference: The Future of Labour!

We are deeply grateful to all participants and speakers who made this year’s conference in Warsaw such a vibrant and insightful event.

See you next year!

Photo credit: Magdalena Kępa

Working in your 60s: a way to stay young for some | Institute for Fiscal Studies On average, women who remained in work for longer following increases in the state pension age saw improved cognition and less physical disability.

📗 Read our briefing here: ifs.org.uk/articles/wor...

📗 Read the journal article published in Labour Economics: ifs.org.uk/journals/imp...

Join us for our 2025 IFS Annual Lecture on trade wars and the future of globalisation, presented by Professor @meredith-crowley.bsky.social

Tuesday 20 May | 18:30–20:00 | The View, Royal College of Surgeons, London

Find out more and sign up here: ifs.org.uk/events/ifs-a...

The impact of labour demand shocks when occupational labour supplies are heterogeneous | Institute for Fiscal Studies We develop a tractable equilibrium model of the labour market with heterogeneous labour supply elasticities by occupation and across occupation pairs.

12/ Curious how we estimate elasticities from job flows?

Or how correlated shocks make inequality worse?

Full story – theory, data, and projections – in our WP ⬇️

ifs.org.uk/publications...

11/ But this works both ways.

Occupations in health/education may see larger wage increases, but can’t attract IT workers – low cross-elasticity.

Result: IT projected to grow >20% as share of employment over the next decade.

10/ Take, for example, IT. Why does it grow fast?

Relative wage gains in IT attract inflows from jobs with smaller wage shifts.

It can pull in workers from many nearby jobs – both technical and managerial.

9/ The model projects

🏗️ IT & construction: employment gains
👩‍🏫 Health & education: wage rises
🏭 Manufacturing + some high-skill jobs (e.g accountants): wage declines

8/ We then simulate how the labour market might respond to automation-driven tech shocks. We combine

🧍 Worker flows (2012-2021)
🤖 Expert views on task-automation risk

= equilibrium projections of employment, wage & job flows.

7/ Key insight 2️⃣

Elasticity heterogeneity explains 20% of the variation in occupational employment growth over 1985-2010.
Demand shocks explain 60%, supply shocks the rest.

6/ Key insight 1️⃣

Demand shocks often hit groups of similar jobs (e.g. motor vehicle drivers, railway engine drivers). This makes it harder for workers to switch, slows employment adjustment, and leads to more unequal wage changes.

5/ We use German panel data tracking career moves.

[1985-2010] Some occupations adjusted to shocks via jobs (e.g. assistants), others via wages.

What explains this? Spoiler: elasticity matters.

4/ We develop a tractable equilibrium model of the labour market that accounts for this heterogeneity. It helps us:

1️⃣ explain historical employment & wage shifts
2️⃣ project responses to future automation shocks

3/ Labour supply elasticities differ not just by job but by job pair.

For example, workers in laboratory medicine may shift quickly into human medicine if wages rise – but carpenters into IT? Much harder.

2/ Not all jobs are equally “elastic”. Some (e.g. doctors) have rigid labour supply – higher wages don’t attract many new workers.

Others (e.g. assistants) are flexible – wage rises boost employment.

1/ The labour market has seen significant changes in recent decades. With automation accelerating, more is coming.

Can workers switch jobs fast enough to keep up?

We study how reallocation across occupations shapes wages, employment and inequality. #EconSky

New WP ⬇️

ifs.org.uk/publications...

How much do regional inequalities shift when we swap income for consumption?

New estimates of household spending (net of housing) show smaller gaps — and a different map.

Methodologically rigorous, policy-relevant work from my colleagues @peterlevell.bsky.social and Gautam Vyas

#EconSky

"It's almost entirely passed on to domestic consumers."

Who pays the costs of tariffs? @pjtheeconomist.bsky.social and
@peterlevell.bsky.social discuss in our podcast episode on tariffs from earlier this year.

🎧 Listen here: ifs.org.uk/articles/do-...

Helen Miller appointed as new Director of the Institute for Fiscal Studies | Institute for Fiscal Studies The Institute for Fiscal Studies (IFS) is delighted to announce that Helen Miller has been appointed as its next Director.

We are delighted to announce that @helenmiller.bsky.social has been appointed as the next IFS Director, following on from @pjtheeconomist.bsky.social in July 2025.

Find out more:

The welfare effects of price shocks and household relief packages: Evidence from the European Energy Crisis | Institute for Fiscal Studies How should governments respond to rapid increases in the cost of living driven by shocks to the prices of staple goods?

NEW #IFSWorkingPaper: The welfare effects of price shocks and household relief packages: Evidence from the European Energy Crisis

Read @peterlevell.bsky.social, Martin O'Connell and Kate Smith's paper: ifs.org.uk/publications...

Volume 5 of the Handbook of Labor Economics Published We are pleased to announce the release of Volume 5 of the Handbook of Labor Economics, edited by Christian Dustmann and Thomas Lemieux. Recognized as a leading resource in the field, the Handbook brin...

We are pleased to announce the release of Volume 5 of the Handbook of Labor Economics, edited by Christian Dustmann and Thomas Lemieux.

#Podcast #Trade #Tariffs | Why do countries trade? Are tariffs good or bad? Who pays the price? Do listen to @peterlevell.bsky.social on this episode as he breaks it all down with clarity and common sense. #EconSky

New working paper out!

Governments in many countries have raised early retirement ages (ERAs) in response to public finance pressures from ageing populations.

These policies have consistently been found to lead to increased employment rates among older workers.

This paper asks: why? 🤔

#EconSky #EconConf | Don't miss out. Submit your abstracts by 3rd January and meet my former colleagues in Colchester this spring.

2 days of exciting conversations around research + keynotes by Imran Rasul (UCL, IFS) and Ben Etheridge (Essex).

All the info here: www.essex.ac.uk/events/2025/...

Where does the UK fall in the international employment rate league table? There are uncertainties around the data, but we know around 75%-76% of 16-64-year-olds are in work in the UK. This puts the UK above the average for the OECD, but a way back on the four countries who have already hit 80%.

NEW: Air pollution in England has halved since 2003 after falling substantially during the pandemic, but inequalities in exposure remain.

@lgadenne.bsky.social @leroutierm.bsky.social Rodrigo Toneto and Bobbie Upton’s new report examines how air pollution has changed in England over 20 years:

Important analysis on differential household responses to sectoral change driven by global trade!