Employers want to limit wage costs; Many Dutch can forget increases next year
Employers in the Netherlands want to limit labor costs and will push against wage increases next year. “Our labor costs per hour worked are 35 percent above the European average,” employers wrote in their employment conditions memorandum. According to them, companies are spending so much on labor costs that they don’t have money left ot invest, the Telegraaf reports.
“We shouldn’t just talk about dividing the pie. We should also talk about how we can make it bigger,” said Lisette van Breugel, the new director of the AWVN. She spoke to the newspaper on behalf of the employers’ organizations AWVN, VNO-NCW, and MKB Nederland.
“Things aren’t going well in many sectors. We’re seeing several major reorganizations, and more are likely to come, Van Breugel said. “In that respect, the situation has really deteriorated compared to a year ago.”
According to employers, the Netherlands has become more expensive and less attractive than other countries. Our country is among the top three in Europe for labor costs, while companies face slow decision-making processes and problems with electricity and nitrogen emissions. The energy costs are also higher than in neighboring countries.
The employers plan to convince the trade unions to work together to find solutions for the struggling economy, Van Breugel said. That means no longer focusing on wages in collective bargaining agreements. “In recent years, the focus has almost exclusively been on purchasing power. That has now recovered across the board. But if wages rise further, we’ll price ourselves out of the market,” she said.
“Employers feel that not everyone realizes how bad things are in some sectors,” Van Breugel said. “But if you want to start a new factory, and you see that the costs in France are a third lower than here, why would you still choose to set up here?”
She stressed that companies need to invest, but are spending too much on labor costs. “That’s why we advocate for appropriate wage agreements. This means an employer can be generous if the company is doing well. You could consider some form of profit sharing or variable performance-related pay,” Van Breugel said. “But elsewhere, there will be a pause in salary terms.”
Whether employers will succeed in not paying wage increases next year remains to be seen. The Netherlands’ labor market is still tight, and employers need to offer attractive employment conditions to attract and retain staff. The trade union CNV said it would be aiming for wage increases between 3.5 and 5 percent next year, depending on the sector.
