Netherlands residents had 1.7% more disposable income in first quarter

Households in the Netherlands had 1.7 percent more disposable income on average in the first quarter of 2023 compared to the same period last year. The increase is mainly due to higher pay from wage increases and working more hours, Statistics Netherlands (CBS) reported on Friday.

Employees’ total compensation grew by 7.7 percent compared to Q1 of 2022, and the number of hours worked by 2.2 percent. Collectively agreed wages rose 5.4 percent. And mixed income was 12.7 percent higher.

People on social support saw their benefits increase by 11.1 percent in the first quarter compared to a year earlier. That increase is mainly due to the 10 percent bump in the minimum wage in January. Welfare benefits are linked to minimum wage.

But due to a 4.4 percent increase in taxes and social security contribution and the high inflation, the actual disposable income only rose 1.7 percent.

In the first quarter of 2023, residential mortgage debt increased by 3.3 billion euros compared to the previous quarter. “Mortgage debt is rising less sharply than last year because house prices are falling and fewer homes are being sold,” CBS said.

Due to economic growth, mortgage debt as a percentage of the GDP decreased from 84.8 percent in the fourth quarter of 2022 to 83.2 percent in the first quarter of 2023. “That is the lowest level after the fourth quarter of 2002,” CBS said.