Fewer employees with permanent contract

12/12/2012 08:33

The composition of the employed labour force in the Netherlands has changed in the last ten years. It now comprises fewer employees with a permanent position, but more with flexible contracts and self-employed people. 

Size of employed labour force fairly stable in last two years

The employed labour force in the Netherlands consisted of 350 thousand more people in the third quarter of 2012 than in the third quarter of 2002. Until the beginning of the recession at the end of 2008, the employed labour force grew by nearly 500 thousand people, and then decreased again subsequently. Since the second quarter of 2010 it has been around 7.4 million people.

Employed labour force by type of contract

Employed labour force by type of contract

Number of permanent workers correlates with business cycle

The number of employees with a permanent employment contract follows the business cycle with a slight delay. As the economy picks up, their number increases. When the economy goes into recession, the number shrinks again. The number of self-employed people on the other hand grew between 2002 and 2012.

The number of employees with a flexible employment contract rose strongly in 2006 and 2007 and then stabilised. This year it has risen again slightly. The number of flex workers was over 340 thousand higher in the third quarter of 2012 than ten years previously. There are more temporary workers in a trial period, in particular; they can expect to move into a permanent position.

Fewer permanent contracts mainly among young workers

In the third quarter of 2012, 69 percent of the employed labour force had a permanent employment contract. Ten years previously this was still 75 percent. Younger employees, in particular, are less likely to have a permanent position. The share of employees with a permanent contract among 25-34 year-olds fell from 77 to 68 percent. Among 15-24 year olds the decrease was even larger.

Share of employees with permanent employment contract

Share of employees with permanent employment contract

Relatively many flex workers among lower educated

Relatively more workers with a low education level have a flexible labour contract. People with higher levels of education are relatively more likely to be self-employed. In the third quarter of 2012, 20 percent of workers with a low education level had a flexible contract, while 13 percent were self-employed. For workers with higher education levels these shares were 14 and 17 percent respectively.

Share of employees with a flexible employment contract and self-employed, 3rd quarter 2012

Share of employees with a flexible employment contract and self-employed, 3rd quarter 2012

Marian Driessen and Hendrika Lautenbach