The Swiss 'Job Miracle'

KOF Working Papers No. 368

39 Pages Posted: 11 Dec 2014

See all articles by Michael Siegenthaler

Michael Siegenthaler

ETH Zürich - KOF Swiss Economic Institute

Michael Graff

ETH Zurich

Massimo Mannino

University of St. Gallen

Date Written: December 5, 2014


While Switzerland’s recent growth of employment was high in historical and international perspective, the reasons for this “job miracle” were not well understood. As the “miracle” was not anticipated by economic forecasters, it consequently resulted in systematic and persistent forecast errors. This paper shows that the “miracle” is related to a substantial increase in the labor intensity of economic activity. To this end, we present a number of stylized facts reflecting shifts and structural changes that affected the Swiss economy around 2000. Then, we discuss potential drivers of the “miracle” which are consistent with these facts. Finally, we demonstrate how they contribute to understand why, during the last ten years, forecasters systematically underestimated the growth of domestic employment. Finally, we highlight that immigration was not only a consequence of the “miracle”, but also an important cause, as it created additional jobs in Switzerland by raising local demand for goods and, most importantly, services.

Keywords: Migration, Labor Market, employment forecasts, local multipliers, free movement of persons, Swiss job miracle, Labor market, migration

JEL Classification: C52, E24, J21, J61

Suggested Citation

Siegenthaler, Michael and Graff, Michael and Mannino, Massimo, The Swiss 'Job Miracle' (December 5, 2014). KOF Working Papers No. 368, Available at SSRN: or

Michael Siegenthaler (Contact Author)

ETH Zürich - KOF Swiss Economic Institute ( email )


Michael Graff

ETH Zurich ( email )

KOF Swiss Economic Institute
Leonhardstrasse 21
CH-8092 Zurich, 8092

Massimo Mannino

University of St. Gallen ( email )

Langgasse 1
St. Gallen, 9008

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