Labour participation rate is high
Nearly 10 million people in the Netherlands are in paid employment. Compared to other countries, we work part-time more often. But because we retire at a relatively old age, we proportionally work more hours than in many countries around us. Three quarters of the Dutch population aged between 15 and 75 are working or looking for work. This is an all-time high for our country, and within Europe this percentage is higher only in some of the Scandinavian countries.
Labour market to remain tight
The Dutch labour market is not only strong, but also tight. This means many companies are looking for workers while few people are looking for a job. There is a huge shortage of staff in various sectors such as ICT, construction, healthcare and education. At the end of March 2023, there were 437,000 vacancies, well above the average of 181,000 since records began in 1997. One of the consequences of labour market tightness is that people switch jobs more easily, for example because of more favourable working conditions including higher pay. At some companies, employees who bring in new colleagues are given a recruitment bonus.
Current demand for products and services is so high that there are not enough workers to meet this demand with today’s production techniques. It would be beneficial for economic growth if we all worked more hours than we already do. But people are not always willing or able to do so, for example because they are caring for a friend or family member or because they are studying. The population is ageing, and this reduces the number of employable people. We therefore expect the labour market to remain tight in the coming years. On top of that, an ageing population means that more care needs to be provided, which means we also need more workers in the healthcare sector.