Labor supply shocks can have substantial effects on the Beveridge Curve. Structural VARs with sign restrictions show that
the shocks associated with the free movement of workers from Eastern Europe have temporarily increased unemployment in Austria,
a major destination country, by 25 percent and job vacancies by 40 percent. The 2 percent increase in total employment was
accompanied by a temporary decline in the employment of domestic workers. The greatest impact is seen in regions bordering
on the home countries of the migrant workers. Beyond these findings the paper addresses empirical regularities of labor supply
shocks that are at odds with theoretical predictions.