Dutch economy shrinks, unemployment increases, Eurozone improves
According to CBS, the Dutch national statistics office, in the second quarter of 2013 the Dutch economy shrank by 0,2 per cent, making it the fourth quarter in a row to show economic decline.
A number of indicators are lower this year when compared to last year. Household spending on goods and services, already in a downward spiral from faltering consumer confidence, was down 2,4 per cent. As was the turnover generated by the retail sector, down approximately 1,5 per cent from the same period last year.
Dutch consumers are not only buying fewer durable goods like cars and furniture, they are also cutting down on essentials such as food and drink.
The only essential to rise was natural gas, due to the unusually cold spring, which had the further effect of increasing CO2 emissions by 1,6 per cent over the same quarter.
Investment also took a hit, down nearly 10 per cent from last year, in the sixth consecutive quarter of decline. Exports also fell significantly, while imports were also lower. Overall, most sectors declined in terms of output, notably construction and manufacturing.
The big news is the jump in unemployment. The number of people looking for a job grew by 19.000 in July to reach 694.000, an unemployment rate of 8,7 per cent.
Youth unemployment was much higher at 17 per cent, while it was lower for other age groups, at 7,9 per cent among 25 to 44-year-olds and 7,5 per cent for over-45s.
According to the Institute for Implementation of Employees’ Insurances (UWV), the number of people claiming unemployment (WW) benefits grew by 13.000 to 395.000.
There has also been a dramatic loss of available jobs, with 6.000 less vacancies than in the first quarter of this year, making this the lowest number of vacancies for the whole of the past decade.
This reduction has occurred entirely in the private sector, especially in the construction and business services sectors. By contrast, vacancies in the public sector have in fact grown.
Any good news?
The positives among all this bad news are that while, in respect to spending, almost every area has declined, each decrease was smaller than it had been in previous quarters. This is not the case for unemployment, unfortunately, where the number of jobless has soared over the past year.
The light at the end of the tunnel, however, may be coming from outside the Netherlands. The Eurozone has finally returned to growth after 18 months stuck in a double-dip recession.
There has been a collective expansion among the 17 countries of 0,3 per cent in the three months to June, the first increase in activity since the autumn of 2011. The Netherlands’ closest neighbours (except Luxembourg) all grew, albeit all by less than one per cent.
Nonetheless, Europe's economic commissioner Olli Rehn still sounded a note of caution. "A sustained recovery is now within reach, but only if we persevere on all fronts of our crisis response: keep up the pace of economic reform, regain control over our debt, both public and private, and build the pillars of a genuine economic and monetary union."