Dutch government aid prevented 230.000 layoffs and 5.300 bankruptcies
Financial support from the Dutch government throughout the coronavirus pandemic prevented 5.300 bankruptcies and stopped around 230.000 people from losing their jobs, according to figures published by Rabobank.
Dutch government's financial support saved businesses and jobs
Last spring, the Dutch government launched an extensive financial support scheme to help companies and self-employed people survive the coronavirus pandemic and resulting lockdowns. While many believed the pandemic would lead to a spike in unemployment and thousands of businesses having to close their doors for good, figures published by Rabobank have revealed that the financial support packages successfully prevented thousands of redundancies and bankruptcies.
Projections made by the Dutch bank show that unemployment in the Netherlands would be 5,7 percent this summer, when in May it was “only” 3,3 percent. Economists expect that if the economy shrinks by one percent, unemployment will rise accordingly - but support packages like NOW and Tozo meant these predictions didn’t come to pass. “If you compare the expectation with reality, there is a big gap,” says Rabobank’s Hugo Erken. “You have to give the cabinet the credit for that."
Rabobank predictions for the Netherlands post-coronavirus
Rabobank does expect unemployment will rise slightly to 4,2 percent in 2022, but believes that as long as there are no further lockdowns, the predicted wave of bankruptcies in the Netherlands will not come to fruition. The bank expects the Dutch economy to return to pre-coronavirus levels in the third quarter of this year, but it is worth noting that, when the financial support comes to an end this autumn, the number of bankruptcies is likely to rise.
Of course, some sectors have struggled more than others. The catering industry, for example, has found it extremely difficult, as has the tourism industry. Furthermore, while the government’s support has proved invaluable for the Dutch economy, it has also been extremely expensive; around 20 billion euros have been spent on NOW packages alone over the past year and a half.