Economic situation improves slightly

15/05/2018 15:00
© Hollandse Hoogte
According to the CBS Business Cycle Tracer, the economic situation has improved slightly in May compared to the previous month. Statistics Netherlands (CBS) reports that all indicators in the Tracer published mid-May are performing above the level of their long-term trend.

Statistics Netherlands’ Business Cycle Tracer is a tool used to monitor the economic situation and economic developments. It uses thirteen key macro-economic indicators, which - together - provide a coherent macro-economic picture of the state of the Dutch economy as published by CBS during the last month or quarter.

Mood among consumers improves slightly, producer confidence again slightly less positive

The mood among Dutch consumers improved marginally in April 2018. Opinions among Dutch consumers on the economic climate were slightly more positive. Willingness to buy also improved marginally. Consumer confidence is significantly above its long-term average.

Producer confidence deteriorated for the second month in a row. However, the confidence indicator remains well above its long-term average over the past two decades.

Household consumption, investments and exports growing

Year-on-year, consumer spending was over 3 percent higher in Q1 2018. This is the highest growth rate in more than 17 years. For 16 quarters in a row, consumer spending has risen relative to one year previously.

In Q1 2018, consumers mainly spent more on passenger cars, electrical appliances, clothing and home furnishing articles. Natural gas consumption also increased. Q1 2018 had colder weather conditions compared to Q1 2017. Dutch consumers also spent more on services, e.g. in hotels and restaurants. Spending on services accounts for more than half of total domestic consumer spending.

Investments in fixed assets were over 6 percent higher than one year previously. Again, Q1 2018 mainly saw an increase in investments in residential property and transport vehicles. Entrepreneurs also invested more in machinery.

Exports of goods and services grew by nearly 4 percent in Q1 2018. One quarter previously, exports grew almost twice as fast. Dutch companies exported mainly more machinery and chemical products in Q1 2018. Exports of transport equipment rose more than average. Re-exports (i.e. exports of imported products) grew at a slightly faster pace than exports of domestic products.

Manufacturing output 3.5 percent up in March

The average daily output generated by the Dutch manufacturing industry was 3.5 percent up in March compared to the same month last year. The growth rate was lower than in February. For two and a half years now, manufacturing output has continually been above the level of the same period year-on-year. Again, the strongest growth in March 2018 was seen in the pharmaceutical industry.

Number of bankruptcies remains stable

The number of bankruptcies was the same in April 2018 as in the preceding month. In March the number rose by 34.

Tighter labour market

The number of full-time and part-time jobs held by employees and self-employed saw quarter-on-quarter growth of 76 thousand in Q1 2018, the strongest growth after Q2 2007. The number of jobs has been growing almost continuously for over four years now, in total by over 600 thousand.

The number of job vacancies grew by 8 thousand in Q1 2018. As a result, 235 thousand job vacancies were available at the end of March, 49 thousand more than one year previously. The number of vacancies has been growing for almost five years now.

Adjusted for seasonal effects, unemployment amounted 368 thousand in Q1 2018, according to the ILO indicator. This is 30 thousand less than in the previous quarter. The unemployment rate stood at 4.1. Unemployment peaked at 7.8 percent in Q1 2014. Since then, this number fell for 16 quarters in a row.

As the number of job vacancies increases, while the number of unemployed people declines, tension on the labour market grows. The number of unemployed persons for each job vacancy was 1.6 on average in Q1 2018. However, the labour market is not as tight as in 2008, when 1.3 people were unemployed for each job vacancy.

Largest turnover growth in 2 years for temp agencies

Turnover generated by temping agencies, employment agencies and payroll companies grew by 2.5 percent in Q4 2017 relative to Q3 2017. This is the highest increase in 2 years. The number of temp hours also increased again in Q4.

GDP growth 0.5 percent in Q1 2018

Gross domestic product (GDP) rose by 0.5 percent in Q1 2018 relative to Q4 2017 as shown in the first estimate of GDP conducted by CBS, which is based on currently available data. Growth is mainly due to investments in fixed assets and household consumption. The GDP growth rate was 2.8 percent in Q1 2018 compared to Q1 2017.

On Friday 22 June 2018, CBS will publish the second estimate of GDP and employment in Q1 2018.