According to Statistics Netherlands’ Business Cycle Tracer, the economic situation in September was about the same as in August. Economic recovery has come to a virtual standstill over the last months. In September, improvements and deteriorations again cancelled each other out. Just over half of indicators in the Business Cycle Tracer show an upward trend.
Business cycle tracer indicator (unweighted average of the fifteen indicators in the Business Cycle Tracer)
Producer and consumer confidence down
Confidence of Dutch manufacturers has deteriorated in the last few months. In July it reached its highest level since July 2011. In September pessimists again just outnumbered optimists. Manufacturers are mainly more negative about their order positions and their expected output.
Consumers have also become more pessimistic. In June, consumer confidence was higher than it had been since November 2007. In the last two months, consumers have become more apprehensive about the economic climate in general. The declining confidence of producers and consumers coincides with the current international political tensions.
Producer and consumer confidence, seasonally adjusted
Household spending on goods and services was 0.5 percent up in July 2014 from July 2013. In May and June, household spending was at approximately the same level as one year previously. Prior to the stabilisation and modest growth, household consumption had been in decline for nearly three years. Investment and exports were also up.
The volume of exports of goods was 4.7 percent higher in July 2014 than twelve months previously. This increase was mainly caused by higher re-exports. For some products, exports of Dutch manufactures were also up. Exports of machinery, installations and metal products in particular were considerably higher, as a result of both higher exports of Dutch product and higher re-exports.
Fixed capital formation rose by 5.2 percent between July 2013 and July 2014. Investment in residential and non-residential property and in infrastructure projects were the main contributors to this growth.
Manufacturing output up further
The average daily manufacturing output was 0.7 percent up in July 2014 from July 2013. Since October 2013, manufacturing output has almost consistently been above the level of twelve months previously.
Output in the sector electrical and machinery and in metal products was considerably higher in July than one year previously. In the sector food, drinks and tobacco, production was at the same level as one year previously, while output in the sector petroleum, chemical, rubber and plastic products decreased. Together, these four sectors account for nearly three-quarters of manufacturing output.
Labour market situation also better
The situation on the labour market is also improving. The number of jobs of employees decreased only slightly. Unemployment has deceased for four months in a row now as more people are finding work. The level is still high though: in August it was 8.0 percent. The number of businesses declared bankrupt decreased considerably after a peak in mid-2013, but remains relatively high compared to the pre-crisis level.
Just as in the three preceding quarters, the number of job vacancies rose marginally in the second quarter. The total number of hours worked in temp jobs was fractionally higher in the second quarter of 2014 than in the first quarter. This increase was the result of a rise in the number of long-term contracts, e.g. secondment and pay rolling.
GDP (seasonally adjusted)
Modest economic growth
The most recent economic growth figure refers to the second quarter of 2014: 0.7 percent compared with the first quarter. Quarter-on-quarter growth figures are adjusted for calendar and seasonal effects. Year-on-year growth was 1.1 percent in the second quarter. Dutch economic growth is mainly driven by exports.
The volume of the Dutch economy was 0.3 percent larger in the second quarter of 2014 than in the last quarter of 2013. Compared to business cycle peak in the first half of 2008, the Dutch economy is 2.4 percent smaller.
More figures can be found in the Business cycle dossier.
For more information on economic indicators, see the Economic Monitor.