Higher wages, shorter work week won’t fix labor shortage, business leaders claim

Unlike the trade unions, employers association AWVN thinks the shortage on the labor market should be tackled with a longer work week. More people currently on the sidelines should also be helped to find work, including people who immigrated to the Netherlands, and workers must not leave the workforce too quickly, the AWVN said.

On Thursday the AWVN, the main employment conditions adviser to employers in the Netherlands, will present their view on the labor shortage. General director Raymond Puts already gave FD and the NRC a glance. He contradicts that higher wages, like trade union FNV is advocating for, is a solution to the problems on the labor market.

Puts told NRC that raising wages is "the worst idea you can think of" against the staff shortages. "It may sound attractive if everyone earns 10 percent more, but that doesn't suddenly mean 10 percent more people in the workplace in the Netherlands."

According to Puts, the 1 million people who are on the sidelines of the labor market must be helped to find work. Many of them have an immigration background, he said. "Their prospects for a job are currently not much better than that of people with a disability. So there is a lot of potential, because part of that group can start working tomorrow, so to speak," said Puts to FD.

People should also not leave the workforce too quickly, Puts said. And the Early Retirement Scheme (RVU), which can be used since the beginning of this year, does not help with that, according to him.

Trade unions CNV and FNV were outraged by the AWVN statements. "A longer working week is the worst possible idea, especially in a time when unpaid care tasks are increasing due to an aging population, women are working longer hours than ever, and the number of burnouts is through the roof. Completely outdated," said CNV chairman Piet Fortuin in a statement.

According to him, employers who only offer 40 hour contracts are pricing themselves out of the market. "Certainly for younger employees, who put a lot of stock in a good balance at home. CNV therefore also advocates the 30-hour working week. Let's not go back to the over-strained economy from before the coronavirus crisis. We should not work longer, but smarter," said Fortuin.

FNV already said that working more hours is not a solution to the shortages on the labor market. "Working more hours, like employers want, is not a solution. In the Netherlands we already work quite a few hours, and also during a long period in our lives," said FNV vice president Zakaria Boufangacha.

The unions also disagree with the AWVN statement that higher wages will not help with the shortages. "In a flourishing economy, employers complain that they cannot find people and have to cancel clients. The money is therefore available for more wages. Employers just have to take the step," CNV said. FNV agrees: "People should receive more wages and security, then work in tight sectors will become attractive again."

CNV does think it a good idea if people currently on the sidelines get more work prospects, as AWVN proposed. Fortuin: "But the ball is in the employers' court here too. People with an immigration background are often not invited for an interview. Older employees are also too often left on the sidelines, according to our research. Capital destruction. It would be good if employers take a broader view and also offer this group more opportunities."