Overfull Employment

Overfull Employment

A situation in which the demand for labor exceeds supply. This results in wage and salary increases as employers try to attract employees. This, in turn, leads to employees spending more of their higher wages, which results in higher prices. According to some economists, overfull employment leads to inflation.
References in periodicals archive ?
The lack of a good theory relating employment to prices, the big weakness in the Keynesian political economy, meant that governments in 1960s-70s relied on incomes policy to achieve their overfull employment targets.
The change from overfull employment to severe recession-level unemployment would seem very likely to have a greater effect on turnover than the 5% rise in [w.