The key debate on the level of potential growth

We look at the situations of the United States and the euro zone. Potential growth is the sum of: The trend in productivity gains; Growth in the working-age population; The trend in employment rate growth . The debate concerns trend s in productivity gains and in employment rate growth: Labour productivity rose sharply in the United States in 2020, so there is a big difference in productivity growth between the 2018-2023 period and the 2021-2023 period; Labour productivity has been stagnating, or even declining slightly, in the euro zone since the end of 2017; the debate concerns whether this stagnation in productivity is transitory or lasting; The employment rate has risen significantly in the United States and the euro zone since 2014; the debate is about how much of a slowdown should be expected for the employment rate in both countries/regions. Based on the assumptions used, we arrive at an estimate of between -0.1 % and 2.8% for potential growth in the United States and between -0.1% and 1.0% in the euro zone.