Netherlands' economic climate deteriorates further in January 2024

The country's GDP contracted by 0.3 per cent in Q3 2023 compared to the previous quarter, according to the second quarterly estimate by CBS. This marked the third consecutive quarter of contraction, primarily attributed to declining investments in fixed assets, reduced inventory changes, and decreased household consumption.

Consumer and producer confidence saw some improvement in January 2024. Dutch consumers were less pessimistic than the previous month, though confidence still lagged significantly behind the two-decade average. Producers also showed signs of less negativity compared to December, but their confidence remained below the 20-year average.

On the consumption front, household spending increased by 0.3 per cent YoY in November 2023, adjusted for price fluctuations and shopping-day patterns. Services consumption saw growth, while goods consumption remained relatively stable, CBS said in a press release.

In November 2023, Dutch exports faced challenges, with the total volume of goods exports declining by 4.5 per cent YoY, adjusted for working days.

Investments in tangible fixed assets experienced a 3.6 per cent YoY decline, primarily driven by reduced investments in buildings and infrastructure.

The manufacturing sector faced a significant setback, with average daily output dropping by 10 per cent in November 2023 compared to the same month in the previous year. This contraction continued throughout 2023, with a 0.8 per cent decrease from October to November.

December 2023 witnessed a concerning trend in bankruptcies, with 91 more cases than the previous month, marking a 30 per cent increase. This upward trend in bankruptcies persisted for over a year.

On the labour market front, Q3 2023 saw a 0.4 per cent increase in hours worked, adjusted for seasonal variations. Total hours worked by employees and self-employed individuals exceeded 3.6 billion during this period. However, there were fewer unfilled vacancies for the fifth consecutive quarter, with 416 thousand at the end of Q3, down by 12 thousand from the end of Q2.

In December, the unemployment rate stood at 3.6 per cent of the labour force, consistent with the 2023 average. Throughout Q4, unemployment gradually decreased by an average of 3 thousand per month, ending at 361 thousand in December.

Temporary employment and job placement agencies experienced a 0.5 per cent turnover increase in Q3 2023 compared to the previous quarter.

Fibre2Fashion News Desk (KD)