Economy deeper in recession in June

© Hollandse Hoogte / Herman Wouters
According to the CBS Business Cycle Tracer, the economic situation has still deteriorated rapidly this month. The economy has entered a stage of deep recession. Statistics Netherlands (CBS) reports that as of mid-June, 11 out of the 13 indicators in the Business Cycle Tracer are positioned below their long-term trend. The effects of measures against the coronavirus outbreak have had a major impact on many indicators of the Tracer.

The CBS Business Cycle Tracer is a tool used to monitor the state and the course of the Dutch economy and is based on 13 key macro-economic indicators. Together, these provide a coherent macro-economic picture based on CBS figures which are being published over the past month or quarter. It does not necessarily represent the situation at the level of of individual households, businesses or regions.

Business Cycle Tracer indicator (unweighted average of the indicators in the CBS Business Cycle Tracer)
YearMonthcycle (distance to the long-term trend (=0))
2012January-0.04
2012February-0.09
2012March-0.13
2012April-0.16
2012May-0.23
2012June-0.3
2012July-0.36
2012August-0.47
2012September-0.56
2012October-0.63
2012November-0.75
2012December-0.85
2013January-0.93
2013February-1.04
2013March-1.12
2013April-1.18
2013May-1.25
2013June-1.28
2013July-1.28
2013August-1.27
2013September-1.21
2013October-1.14
2013November-1.06
2013December-0.98
2014January-0.92
2014February-0.87
2014March-0.85
2014April-0.83
2014May-0.82
2014June-0.81
2014July-0.8
2014August-0.78
2014September-0.77
2014October-0.75
2014November-0.72
2014December-0.68
2015January-0.64
2015February-0.59
2015March-0.54
2015April-0.49
2015May-0.44
2015June-0.39
2015July-0.35
2015August-0.31
2015September-0.28
2015October-0.27
2015November-0.25
2015December-0.24
2016January-0.25
2016February-0.23
2016March-0.22
2016April-0.21
2016May-0.17
2016June-0.14
2016July-0.11
2016August-0.05
2016September-0.01
2016October0.03
2016November0.08
2016December0.12
2017January0.15
2017February0.21
2017March0.26
2017April0.3
2017May0.37
2017June0.4
2017July0.43
2017August0.49
2017September0.53
2017October0.56
2017November0.62
2017December0.67
2018January0.71
2018February0.77
2018March0.81
2018April0.82
2018May0.85
2018June0.85
2018July0.84
2018August0.84
2018September0.83
2018October0.81
2018November0.81
2018December0.76
2019January0.71
2019February0.68
2019March0.64
2019April0.62
2019May0.6
2019June0.58
2019July0.56
2019August0.52
2019September0.49
2019October0.45
2019November0.42
2019December0.41
2020January0.42
2020February0.41
2020March0.35
2020April0.33
2020May-1.36
2020June-2.36

Consumers and producers slightly less negative

Consumer confidence has recovered slightly relative to the previous month, while producer confidence showed a slight improvement in May over April. Both consumer and producer confidence are below their long-term averages.

Consumer and producer confidence (seasonally adjusted)
YearMonthConsumer confidence (average of the component questions)Producer confidence (average of the component questions)
2016January113.2
2016February73.1
2016March23.9
2016April64.7
2016May74.4
2016June115.4
2016July95.1
2016August91.2
2016September123.4
2016October174.3
2016November213.4
2016December214.7
2017January216
2017February227
2017March247.8
2017April268.3
2017May236.1
2017June237.2
2017July256.6
2017August265.4
2017September238.5
2017October238.2
2017November229.1
2017December258.9
2018January2410.3
2018February2310.9
2018March249.5
2018April258.2
2018May239.8
2018June237.7
2018July236.3
2018August215.9
2018September195.7
2018October155.9
2018November137.2
2018December97.5
2019January05.8
2019February-26.3
2019March-46.1
2019April-36.7
2019May-34.7
2019June03.3
2019July 23.9
2019August03.9
2019September-23.3
2019October-13.6
2019November-22.8
2019December-22.9
2020January-32.5
2020February-23.7
2020March-20.2
2020April-22-28.7
2020May-31-25.1
2020June-27

Exports, investments and household consumption down

In April 2020, consumers spent 17.4 percent less than in April 2019. This is by far the largest contraction in domestic household consumption which has ever been recorded by CBS. Consumers mainly spent less on services, durable goods and motor fuels; on the other hand, they spent more on food, beverages and tobacco.

In April 2020, the total volume of goods exports shrank by 11.2 percent year-on-year. This is the biggest contraction in exports since July 2009. In April, exports of transport equipment and machinery decreased in particular. Domestic exports contracted more significantly than re-exports.

The volume of investments in tangible fixed assets was 10.6 percent down in April 2020 relative to the same month last year. This is the largest contraction since July 2013. The decline is mainly due to lower investments in buildings, passenger cars, delivery vans, lorries and semi-trailers, and machinery.

Manufacturing output 11 percent down in April

In April 2020, the average daily output generated by the Dutch manufacturing industry was 11 percent down on April 2019. Output showed the largest year-on-year decrease since mid-2009.

Fewer bankruptcies in May

Adjusted for court session days, there were 73 fewer corporate bankruptcies in May than in the previous month.The trend has been slightly upwards since October 2018.

Several weeks may pass between the date of filing for bankruptcy and the court decision. As of week 14, Dutch courts are granting a longer application period of at least four weeks in cases of a bankruptcy petition being made (i.e. by claimants), unless the procedures are deemed urgent. In addition, the Dutch government has established an emergency package for the economy and the job market in order to provide the proper support to Dutch businesses.

Number of jobs continues to grow

In Q1 2020, the number of full-time and part-time jobs held by employees and self-employed rose by 22 thousand to 10,859 thousand jobs. This is an increase of 0.2 percent relative to the previous quarter and the lowest increase since Q1 2016. Compared to Q1 2019, the number of jobs grew by 137 thousand, an increase of 1.3 percent.The figures include the jobs which could not be continued due to the coronavirus crisis but for which workers are still being paid.

The total number of hours worked by employees and self-employed reached a total of over 3.4 billion in Q1 2020. When adjusted for seasonal effects, this is 2.2 percent less than in the previous quarter.

At the end of March, the number of unfilled job vacancies stood at 226 thousand, down by over 60 thousand on the previous quarter. This is the first quarterly decline in seven years’ time and also the largest decline in absolute terms.

Tension in the labour market has fallen slightly. In Q1 2020, there were on average 82 job vacancies per 100 unemployed. In Q4 2019, there were 91 vacancies per 100 unemployed.

In May 2020, there were 330 thousand unemployed people (unemployment according to the ILO definition), i.e. 16 thousand more than in April. As a result, May’s unemployment rate stood at 3.6 percent, the same level as at the beginning of 2019. It was still 2.9 percent in March, butby April it was 3.4 percent.

GDP (volume), seasonally adjusted
   index (2010=100)
2013Quarter 1100.1
2013Quarter 299.9
2013Quarter 3100.5
2013Quarter 4101.1
2014Quarter 1101
2014Quarter 2101.6
2014Quarter 3101.9
2014Quarter 4102.8
2015Quarter 1103.4
2015Quarter 2103.7
2015Quarter 3104.1
2015Quarter 4104.1
2016Quarter 1105.1
2016Quarter 2105.3
2016Quarter 3106.5
2016Quarter 4107.4
2017Quarter 1107.9
2017Quarter 2108.9
2017Quarter 3109.7
2017Quarter 4110.5
2018Quarter 1111.1
2018Quarter 2111.7
2018Quarter 3112
2018Quarter 4112.4
2019Quarter 1113
2019Quarter 2113.4
2019Quarter 3113.8
2019Quarter 4114.3
2020Quarter 1112.6

1.5 percent GDP contraction in Q1

According to the second estimate of GDP conducted by CBS, gross domestic product (GDP) contracted by 1.5 percent in Q1 2020 relative to the previous quarter. The decline was mainly due to falling household consumption. Relative to Q1 2019, GDP contracted by 0.2 percent.

On Friday 14 August 2020, CBS will publish the first estimate of GDP and employment over Q2 2020.

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