People already worried about salary and inflation in 2023: Study

Many Netherlands residents are already worried about next year, fearing that their wage increases won’t be enough to cover the rising costs of living, according to a study by HR service provider Visma Raet.

38 percent of Netherlands residents worry their wage increases won’t be high enough to survive next year. And another 34 percent expect that this will be the case, the Visma Raet researchers found in a survey of over 1,200 Dutch.

The rising prices for energy, fuel, and food are putting increasing pressure on Dutch households. Earlier this month, the Central Planning Office (CPB) predicted that purchasing power would fall 6.8 percent this year.

“Netherlands residents in paid employment are increasingly feeling the pressure to talk to their employer about a pay rise because they fear that they do not earn enough to make ends meet,” Visma Raet said. 38 percent of respondents said they needed to talk to their employers about an increase.

Twenty percent even said they’d need to look for a new job if they don’t get a wage increase by the end of this year. 35 percent are willing to exchange secondary benefits for a higher salary.

“This year, all eyes are on Budget Day. Because the hope is that the government can turn the tide and prevent economic crisis,” the researchers said. Many Netherlands residents hope for tax breaks or other measures to protect their purchasing power.

A quarter of respondents said they don’t know how they’ll make ends meet next year if the government doesn’t announce relief on Budget Day. A third said they would pay more attention to the Budget Day announcement this year.

Earlier this month, Minister Karien van Gennip of Social Affairs and Employment called on companies to increase wages and protect their workers’ purchasing power. And over the past few months, wage increases in the collective labor agreements have been higher than usual, at 3.5 percent in July and 4.1 percent in June, according to figures from AWVN. But that is still well below inflation, which was 10.3 percent in July and 8.6 percent in June, according to figures from Statistics Netherlands.

Ben van der Hee of business management consultancy Boer & Croon pointed out that the government has no control over wage increases, but it can exert influence in other ways. It is itself a big employer, and the government determines the rules for the redistribution of wealth and income. “It can, for example, tax large companies that profit from this energy crisis and relieve citizens. The purpose of taxes is to redistribute income.”

The coalition parties met for four hours on Monday night to try to break the impasse about next year’s budget. This is expected to include plans to boost purchase power and manage the effect high inflation has on people’s wallets.

The ruling parties are expected to meet again this week, with the 2023 budget due annually on the third Tuesday in September. This year that falls on 20 September.