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Faint glimpse of light as Dutch economic barometer points to marginal growth

After six months of recession there are tentative signs that the Dutch economy may be turning the corner.

The latest provisional State of the Netherlands forecast by business website Z24 predicts that the economy will grow by 0.1 per cent in August, the first time this year that the indicator has shown a positive reading.

Other signs also give cautious grounds for optimism. Consumer confidence, which hit an all-time low in June, recovered in July, though the monthly barometer of people’s economic expectations still showed an overall score of minus 32.

Z24 cautioned that there has been a trend in recent months for the actual State of the Netherlands figures to be lower, but the margin of error is becoming smaller, suggesting the economy is stabilising.

Its final figure for July of minus 0.8 per cent growth compared with a projected score of 0.4 per cent.

The Netherlands Bureau for Economic Policy Analysis (CPB) expects that the economy will begin to recover in the second half of 2012, provided that the eurozone crisis does not get any worse. It predicts negative growth of 0.75 per cent over the whole of the year.

People’s confidence in the housing market has also improved marginally, although property prices remain stubbornly low.

One sector that has seen surprisingly strong growth has been the car market. According to the motor trade group Bovag, car sales went up by 52 per cent in June.

The increase is partly explained by the introduction of new rules on company cars, which encouraged businesses to buy new vehicles before July 1. Yet even the number of new cars bought privately increased by 22 per cent in June, following a 20 per cent drop during the first five months of the year.

There is less encouraging news in the job market, where recruitment agencies report a continuing decline in vacancies.

Careers website Monsterboard said the overall number of jobs available had fallen by a quarter in the last year, with jobs in the public sector particularly hard hit. Only bank staff and personnel workers have escaped the drop in demand.

Source: Z24: Stand van Nederland: economie groeit weer

Photo by Shirley de Jong

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