Disposable income rose by 1.4% last year; Dutch GDP growth at 0.4% in Q4
Households had an additional 1.4 percent to spend over the course of 2023 compared to a year earlier, according to a review of disposable income. Statistics Netherlands (CBS) calculated that the growth was mainly due to increased salaries for employees and self-employed workers. Additionally, the Dutch economy grew by 0.4 percent in the final quarter of 2023, slightly better than earlier estimates.
Those in employment and those who are self-employed both saw their pay increase last year. Worker wages rose by 7.7 percent, and collectively bargained wages increased by 6.0 percent. The group of self-employed individuals saw their net gain jump by 8.7 percent.
“The incomes of self-employed people increased, especially in the hospitality sector, specialist business services, rental and sales of real estate, and agriculture,” the CBS said in Monday. The minimum wage hike of over 10 percent at the start of 2023, and a further increase of 3 percent in July, drove the increase in total benefits received. “In addition, benefits also rose sharply due to indexation of pensions.”
While mortgage debt increased, the amount fell when taken against GDP. “Mortgage debt grew by 12.9 billion euros compared to a year earlier, to 826.2 billion euros,” the CBS said. The total was 79.9 percent of GDP last year, compared to 84.8 percent the previous year. “This is the lowest level following 2001.”
The economy of the Netherlands also performed slightly better than previously estimated. Where GDP growth was initially pegged at 0.3 percent for the fourth quarter of the year, that rose to 0.4 percent when the CBS revised its figures.
That put the GDP down 0.4 percent compared to 2022, due to the recession the Netherlands dealt with during the first nine months of the year. The initial estimate showed a decline of 0.5 percent over the course of the year.
“The increase in GDP in the fourth quarter is mainly attributable to household consumption.” Additionally, government spending figures at both the national and municipal level were revised upwards.
“Gross investments have also been adjusted upwards. However, the trade balance has been adjusted downwards. The economic picture did not change,” the CBS said.
About 56,000 more people entered into work in the fourth quarter, a much higher total than the first estimate of 45,000.
Statistics Netherlands had previously said that the economy is supported by the improved purchasing power of households and the strong labor market. Due to higher wages and lower inflation, households have more money to spend on clothing, trips and holidays, for example.
The statistics agency further adjusted job growth upwards in the fourth quarter. According to the second calculation, the number of employee and self-employed jobs increased by 56,000 compared to the third quarter. The first calculation resulted in an increase of 45,000 jobs.
Compared to a year earlier, the economy added 114,000 jobs. That figure was initially estimated at 96,000.
