Economy hardly improves

According to Statistics Netherlands’ Business Cycle Tracer, the economic situation improved slightly in November compared with October, although the recovery is still fragile. In the period between summer 2013 and spring 2014, the economy improved gradually but since then the recovery process has come to a standstill. In November, improvements just prevail over deteriorations.

Statistics Netherlands’ Business Cycle Tracer is a tool used to monitor the economic situation and economic developments. The Business Cycle Tracer uses a selection of fifteen key macro-economic indicators, which – together - provide a coherent picture of the state of the economy at a particular moment in time.

Business cycle tracer indicator (unweighted average of the fifteen indicators in the Business Cycle Tracer)

Business cycle tracer indicator

Consumers more negative, producers more positive

The mood among Dutch manufacturers improved further in november. Manufacturers are far more positive about their expected output and their stocks of finished products. Consumer confidence, on the other hand dropped in November. Consumers were much more negative about the economic situation. Willingness-to-buy remains stable. Consumer confidence is negative since October 2007 and in November is at the same level as its long-term average over the past two decades.

Producer and consumer confidence, seasonally adjusted

Producer and consumer confidence, seasonally adjusted

Exports and investments up, household spending down

The volume of exports of goods was up by more than 6 percent in September 2014 from September 2013. In the preceding month, exports grew by more than 1 percent. Higher exports of Dutch products and higher re-exports contributed to the growth. Dutch companies exported more transport vehicles, machinery and equipment than twelve months previously. Exports of petroleum derivatives, on the other hand, were below the level of the same month last year.

The volume of investments in tangible fixed assets was more than 3 percent higher in September 2014 than in September 2013. Companies invested more to upscale their production capacity. They bought more machinery and computers. This corresponds to the increased capacity utilisation rates and improved business confidence.

Household spending on goods and services was 0.6 percent  down in September 2014 from September 2013. Prior to the decrease, household spending had grown modestly for four months in a row. Spending on durable consumer goods and other goods (e.g. natural gas and motor fuels) declined most notably. Dutch consumers, on the other hand, spent more on food, drinks and tobacco products and on services.

Year-on-year manufacturing output down

The average daily output generated by Dutch manufacturing industry was 1.2 percent down in September 2014 from September 2013. This is mainly due to the results of the sector food, drinks and tobacco. Output realised by the sector electrical products and machinery also shrank. Production in the sector petroleum, chemical, rubber and plastic products and in the sector basic metal and metal products, on the other hand, grew compared to September 2013.

In the fourth quarter of 2014, the capacity utilisation rate of machinery and installations is back to the level of the second quarter, after a dip in the third quarter. In the third quarter, the rate declined marginally for the first time in twelve months.

Slightly more jobs and vacancies in third quarter

The cautious recovery of the labour market continued in the third quarter of 2014. There was a modest increase in the number of jobs and job vacancies.

The number of unemployed hardly changed in October. In September, unemployment also decreased less rapidly than during the period May-August, because more people are competing on the labour market. Part of them do not immediately find work.
The number of businesses declared bankrupt fell substantially after a peak in mid-2013, but is still relatively high compared to the years prior to the recession.

The total number of hours worked in temp jobs was higher in the third quarter of 2014 than in the preceding quarter. The number of temp hours has risen since the second quarter of 2013. The increase is mainly due to a rise in the amount of long-term temporary contracts, e.g. secondment and payrolling.

Gross Domestic Product (seasonally adjusted)

Gross Domestic Product (seasonally adjusted)

Economic growth still fragile

According to flash estimate of economic growth released by Statistics Netherlands on November 14, the Dutch economy grew by 0.2 percent from the second quarter to the third quarter of 2014. This slight growth was the result of increased investment and exports.
The Dutch economy has now shown two consecutive quarters of slight growth, following a contraction in the first quarter. The net result is that the economy was doing better at the end of September 2014 (just over 0.4 percent), although the recovery is still fragile. Compared to the economic boom in the first half of 2008, the Dutch economy contracted 2.3 percent.

Dutch economic growth was 1.1 percent in the third quarter compared with the third quarter of 2013. This growth was mainly accounted for by higher exports, a slight increase in investment and more household consumption. Government consumption was around the same level as last year.

More figures can be found in the Business cycle dossier.

For more information on economic indicators, see the Economic Monitor.