Dutch recession ends
With 0.1% growth in the Dutch economy last quarter, new statistics released by the CBS show the Dutch recession has come to an end. The estimated growth was demonstrated in the third quarter of 2013, compared to the previous quarter.
Negative growth of 0.6% was still seen between Q3 2013 and Q3 2012. The year-to-year comparison includes a loss of 160,000 jobs in the Dutch workforce.
The 0.1% growth was due to a 2.1% increase in exports. However, a drop in consumer spending and investment activity caused the economy to practically flatten. Meanwhile, the job loss marks the largest year-to-year reduction in the workforce in 18 years.
Dutch finance minister Jeroen Dijsselbloem said he is cautiously positive about the growth. While in Brussels he said, "We are emerging from a steep drop, and there is no reason to be too optimistic," according to newswire ANP.
The sentiment was repeated by Klaas Knot, head of the Netherlands Central Bank. Knot says he is troubled by the loss of jobs in the country.
The full press release from the CBS follows:
Dutch economy expands by 0.1 percent, 46 thousand fewer jobs
- Dutch economy up 0.1 percent in the third quarter on the second quarter
- 46 thousand fewer jobs than in the second quarter
- Relative to one year previously:
- the economy is down by 0.6 percent
- investments are 3.0 percent lower
- exports are 2.1 percent higher
- household consumption shrank by 2.3 percent and
- there are 160 thousand fewer jobs
According to the first estimate by Statistics Netherlands, the Dutch economy grew by 0.1 percent in the third quarter van 2013 compared to the second quarter. It is the first time after the second quarter of 2012 that there is any quarterly growth. The quarter-on-quarter developments are seasonally adjusted.
Compared to the third quarter of 2012, the economy shrank by 0.6 percent. The third quarter of 2013 had one working day more than the third quarter of 2012.
Modest decline in investments
Dutch fixed capital formation was down by 3.0 percent in the third quarter of 2013 on a year earlier. The decline was much smaller than in the previous quarters. Investments in homes and in commercial buildings declined less than in previous quarters, for example. Investments in machinery and installations saw some growth, after having declined in the previous quarters.
Exports growing slightly
In the third quarter, the exports of goods and services rose by 2.1 percent on the previous year. The exports of Dutch products grew by 1.3 percent, re-exports by 2.6 percent. Re-exports have been growing for a while, but the exports of Dutch products had been down in the previous two quarters. Dutch imports were close to their 2012 level.
There was a large increase in the exports of natural gas, rubber and plastic products. Exports of machinery and equipment also grew. However, the exports of chemicals showed some decline.
Consumption slowing down further
Households spent 2.3 percent less on goods and services in the third quarter than a year earlier. Consumption has been slowing down for two and a half years now. Households particularly spent less on durables such as cars, clothing and furniture, just like they did in the previous quarters. They also spent less on food, energy and fuel.
Government consumption shrank 1.2 percent. This is mainly due to reduced spending by public administration. However, more was spent on care than a year earlier.
Construction contracting less
Many sectors produced less than a year earlier, but in some sectors production shrank less than in the second quarter. For instance, construction contracted by 2.6 percent, whereas it had contracted by 5.6 percent in the second quarter. Contraction in trade, transport, and hotels and restaurants fell from 2.8 to 0.7 percent. Manufacturing saw contraction turn into an ever so slight expansion, although the extra working day also played a role in this.
Mining and extraction expanded by a robust 7.1 percent, just like it had in previous quarters. The growth was mainly due to rising exports of natural gas. In the previous quarters it was primarily domestic consumption of natural gas that grew, mainly due to the relatively cold weather.
Hefty job losses
There were 160 thousand fewer jobs of employees in the third quarter of 2013 than in the corresponding quarter of 2012. This is a drop of 2.0 percent, which constitutes the largest loss of jobs since the series began in 1995. Construction faced the greatest loss with 31 thousand jobs lost. A striking loss in the third quarter occurred in the care sector, where 30 thousand jobs were lost within one year. These jobs were mainly lost in child care and home help.
The seasonally adjusted figure for jobs was down by 46 thousand on the second quarter of 2013. This is a 0.6 percent decrease.