Analysis: Remember me? With fast recovery, labour shortage haunts Eastern Europe

FILE PHOTO: An employee works at the Wellis hot tub factory, during the coronavirus disease (COVID-19) pandemic, in Dabas, Hungary, March 19, 2021. Picture taken March 19, 2021. REUTERS/Bernadett Szabo/File Photo

BUDAPEST/WARSAW (Reuters) - Central Europe's economies are recovering more quickly than expected from the coronavirus pandemic and industrial output is rising, but a chronic shortage of workers that pre-dates the crisis could be a bottleneck to future growth.

The labour squeeze caused by years of emigration to Western Europe and an economic boom across the region is already pushing up wages and inflation, prompting the Hungarian and Czech central banks to flag possible interest rate hikes.