Dutch Economy Chart Book

Transcription

1 Dutch Economy Chart Book Part 3: labour market ING Economics Department Amsterdam August 17

2 Labour market Employment growth has accelerated in recent quarters. The number of jobs is now higher than it was when the crisis hit the economy. In terms of total hours worked, the labour market has recovered too. Leading indicators point to further growth. The number of unfilled vacancies is the highest since early 9, but it is not yet as high as in 8. Sector-wise, temporary job agencies have been the driving force behind the increase in jobs. This reflects the strong rise of flex workers in the workforce. Industry and construction have experienced strong demand for flex workers. The drag from the public sector (incl health) on the labour market the result of austerity has come to an end. The unemployment rate is falling rapidly. All age groups show a decline. Despite the strong improvement in the labour market, there is no sign of overheating. Wage growth is moderate and there is more slack in the labour market than the unemployment data suggests. In addition to the near 5k unemployed, there appears to be potential labour supply of at least about 3k men and women. Since the start of the crisis, the gross participation rate has declined from 71% to 7%. The decline in labour market participation has been strongest amongst males of 5 to 45 years old. Before the crisis, there was a very strong uptrend in participation.

3 Employment is rising Number of jobs above pre-crisis level, also in hours worked Millions vs now: more jobs in services Share in total employment, in % Public +4%-point Health, government, education Comm. Services +5% Financial, IT, advice (legal/mgt./tech), temp job agencies 3 4 Agriculture -1% Farming, forestry, fishing Industry (inc. energy) -4% Food, metal, chemical, machinery 7 4 Construction -1% Trade -% Retail (incl auto), wholesale, hospitality Total employment, number of employees and self-employed people (left axis) Employment in total hours worked (right axis) 3

4 More work, mostly flex Number of fixed and flexible contracts is increasing Contribution to quarterly change in labour force, in percentage points.8 Job growth driven by commercial services, public no longer drag Contribution to yearly change in employment, in percentage points Total employed labour force Employee, fixed Employee, flex Self-employed w/o pers. ( zzp ) Other (eg, self-employed with employees Public Industry Construction Trade/transport Temp agencies Other sectors (eg, business services, IT, finance, real estate)

5 Leading indicators point to further job growth Consumers and firms have positive expectations Index, standardized Unfilled vacancies and temp hours are still rising Index Quarterly change, in % Businesses employment expectations* Vacancy indicator (left) Consumers unemployment expectations (right axis, inverted) Temp hours worked (right) * Weighted average of manufacturing, construction, retail and services 38

6 Steady drop in unemployment Unemployment still above previous lows As percentage of labour force Lower unemployment in all age groups Share of unemployed in labour force, in percentage Unemployment rate (harmonized) Aged 15-5 Long-term average (197-15) Aged 5-45 Aged 45+ 6

7 Labour market is getting tighter Number of unemployed persons per open vacancy has fallen significantly, but not yet as low as in 8 Ratio

8 In most sectors, labour shortage not yet as acute as in 8 Percentage of firms reporting shortage of workers (note: charts do not have same axes) Industry Real estate services Construction 3 1 Transport (over land) Agri Wholesale Hospitality 1 Retail Mgt. consult. Legal serv IT Marketing Rental serv. Temp job agencies

9 Lower labour participation points to hidden potential supply Potential labour force has outpaced actual labour force Index, 9 = 1 16 Since start of crisis, participation rate has, on balance, fallen Actual labour force as percentage of potential labour force aged % % % Reasons for withdrawal: - Discouraged - Study/re-training - Care-taking - Sick/disability Potential labour force (aged 15-74) Gross labour participation rate, aged Actual labour force (aged 15-74) 9

10 Extra potential labour supply of around 3k people Male participation rate has dropped Actual labour force as percentage of potential labour force aged % 76 75% Strong upward trend in female participation rate stalled Actual labour force as percentage of potential labour force aged % 6 65% K extra men if participation returned to 77% 15K extra female if participation rose to 67% Number of males active on the labour market, in millions Number of females active on the labour market, in millions Assuming part. rate of 77% Actual +15k Assuming part. rate of 68% Actual +15k

11 Contact details Data sources More information? Senne Janssen, Economist, ING Netherlands Page Sources 3 [1] CBS [] CBS, ING calculations 4 CBS, ING calculations 5 [1] CBS, DG ECFIN, ING calculations [] CBS 6 [1] Eurostat [] CBS 7 CBS, ING calculations 8 CBS, DG ECFIN, ING calculations 9 [1] CBS, ING calculations [] CBS 1 CBS, ING calculations 11

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