Higher income makes city dwellers quick to leave

The populations of the four largest cities of the Netherlands are characterised by high rates of new arrivals and departures. The people who move out of the cities again after a few years experience larger increases in their income in those years than those who stay. Foreigners with a non-western background have on average lower incomes than native Dutch people, but those who left the city had a similar increase in income as native Dutch city leavers.

Hello, goodbye

Between September 1999 and September 2003, 393 thousand newcomers arrived in Amsterdam, Rotterdam, The Hague and Utrecht, while 384 thousand people moved out of these cities. This resulted in a small net influx on a total of more than 2 million inhabitants. The number of native Dutch leavers was 35 thousand higher than the number of arrivals, for foreigners the newcomers were in the majority.

Arrivals and departures in the four large cities, September 1999-september 2003

Smaller income rise for those who stay

People who move to the big cities are mainly in their twenties. They go there to study, find their first job there or arrive there directly as immigrants. Once they have completed their studies, or start to earn more, they often move away again. The large cities have tried to stem the outflow – mainly native Dutch people in their thirties with higher incomes - by developing new urban areas for them to live in. In spite of this, newcomers in 1999 who left the cities after a number of years had a larger income increase than those who stayed on. In other words: a larger increase in income correlates with a higher risk of moving.

Non-western newcomers have lower incomes

When they arrive in the big cities, non-westerners already have a lower income per capita than other newcomers. While native Dutch and western newcomers in the large cities had a per capita income of 18 and 20 thousand euro respectively, for non-western foreigners this was only 8 thousand euro. The difference is not only accounted for by earnings, but also by labour participation rates and age composition of the groups of newcomers. Non-westerners arriving to marry a partner already living here, for example, often have no source of income when they arrive.

After three years, the average income had risen for both leavers and stayers-on, but the differences by ethnic background remained substantial.

Annual income of newcomers, leavers and stayers in the four large cities

Income increase for non-western foreigners

Per capita incomes of non-western foreigners increased by the same percentage as those of native Dutch people. In Amsterdam, The Hague, Rotterdam and Utrecht the income of native Dutch city dwellers who left after three years was 44 percent higher than when they arrived in the city. For non-western foreigners this increase was not much smaller, at 42 percent. The city as an enrichment plant, where the people who leave are cleverer and more prosperous, is apparently only a relative phenomenon.

Increase in annual income of newcomers to the four large cities, 1999-2002

Jan Latten and Bas Hamers