Business confidence increases slightly

© Hollandse Hoogte / marlieswessels.nl
Confidence among Dutch entrepreneurs is increasing slightly in Q2 2019, after two quarters of decline. However, staff shortages are still affecting business operations at some enterprises. This is reported by Statistics Netherlands (CBS), the Dutch Chamber of Commerce (KvK), the Economic Institute for Construction and Housing (EIB), the Dutch Organisation for Small and Medium-Sized Enterprises (MKB-Nederland) and the Dutch Employers’ Organisation (VNO-NCW) on the basis of newly released figures in the Netherlands Business Survey (COEN), which is held among Dutch entrepreneurs in the non-financial private sector.

Following a two-month decline, business confidence has risen slightly. At the start of Q2 2019, the sentiment indicator of entrepreneurial Netherlands increased by 1.4 points to 12.0. This means that business confidence is well above the average level since monitoring started in 2008. However, the confidence level is down on the same quarter last year, when the indicator was at a historically high level.

Business confidence
JaarKwartaalBusiness confidence
2008Q4-7.0
2009Q1-24.3
Q2-29.7
Q3-23.5
Q4-13.5
2010Q1-7.1
Q20.5
Q33.4
Q46.1
2011Q17.2
Q210.1
Q33.2
Q4-4.4
2012Q1-6.3
Q2-6.8
Q3-8.6
Q4-9.2
2013Q1-10.7
Q2-11.7
Q3-8.7
Q4-2.7
2014Q11.6
Q24.7
Q32.9
Q44.9
2015Q15.6
Q25.4
Q38.7
Q47.4
2016Q19.3
Q28.8
Q37.9
Q49.2
2017Q114.7
Q215.5
Q315.9
Q413.4
2018Q118.1
Q214.2
Q315.0
Q413.4
2019Q110.6
Q212.0
Source: CBS, EIB, KVK, MKB-Nederland, VNO-NCW
The horizontal line indicates the long-term average

Again highest confidence level in construction sector

In most sectors where the confidence indicator is higher than the average level, confidence has declined. In most of the sectors with lower confidence than the average level, on the other hand, it has improved. Across the board, discrepancies between sectors are therefore smaller than in the previous quarter.

At 27.8, confidence among entrepreneurs in the construction sector is not as high in Q2 compared to Q1. Nevertheless, it is the highest among all sectors for the eleventh consecutive quarter. Confidence is also above average among entrepreneurs in the sectors information and communication, wholesale trade and business services. The transport and storage sector is seeing a substantial increase in Q2 (8.4), recovering from a slightly negative level in the previous quarter. Confidence in retail trade has picked up again as well after a decline in Q1 and stands at 10.9 in Q2. The indicator is negative in the mining and quarrying sector and in car trade and repairs.

Business confidence, by industry
Ondernemersvertrouwen bedrijfstakkenQ2 2019Q1 2019
Non-financial private sector12.010.6
Construction27.831.2
Information and communication17.913.7
Wholesale and commission trade13.415.3
Business services13.017.1
Retail trade (excl. cars)10.94.9
Accommodation and food services8.611.9
Transport and storage8.4-0.2
Real estate, renting and business activities7.23.5
Manufacturing6.75.8
Mining and quarrying-1.04.4
Car trade and repairs-5.3-5.1
Source: CBS, EIB, KVK, MKB-Nederland, VNO-NCW

Sustained staffing shortages

In Q2, one out of four enterprises are hampered by shortages of staff in their business operations. Since mid-2018, the share of entrepreneurs facing shortages has consistently remained around 25 percent. Despite tight labour supply, on balance 10 percent of entrepreneurs expect staff numbers to increase in Q2.

Staffing shortages are cited most frequently by enterprises in the sector business services (34 percent). Within this sector, however, there are major differences. For example, more than half of temp agencies and of security firms experience staffing deficits, while this is the case for only one out of 14 travel agencies. In Q2, staffing shortages are also above average in the sectors information and communication, transport and storage, accommodation and food services and in construction; even higher in the latter two compared to the previous quarter. A shortage of workers is least prevalent among enterprises in the mining and quarrying sector (8.5 percent).

Enterprises with staffing shortages (%)
BedrijfstakkenQ2 2019Q1 2019
Non-financial private sector24.024.1
Business services33.933.9
Information and communication31.233.0
Accommodation and food services29.427.7
Transport and storage28.933.8
Construction26.524.0
Car trade and repairs22.323.7
Manufacturing19.318.9
Wholesale and commission trade18.017.5
Real estate, renting and business activities17.617.9
Retail trade (excl. cars)12.714.3
Mining and quarrying8.59.9
Source: CBS, EIB, KVK, MKB-Nederland, VNO-NCW

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