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Number of employed in Netherlands further up

Christian Fernsby |
In August 2021, 69.5 percent of 15 to 74-year-olds were in employment, a new record in labour participation.

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In the period June through August, the number of employed in this age group rose by an average of 33 thousand per month, to 9.1 million. The total number of unemployed fell by an average 3 thousand per month in the same period.

The unemployment rate did increase slightly between July and August, from 3.1 to 3.2 percent. Statistics Netherlands (CBS) reports this on the basis of new figures. At the end of August, the Employee Insurance Agency (UWV) recorded 213 thousand current unemployment (WW) benefits.

In August, 4.0 million people aged 15 to 74 years did not have paid work for a variety of reasons. In addition to the unemployed, 3.7 million people were not looking and/or immediately available for work recently.

These people are not counted towards the labour force. Their number decreased by an average of 32 thousand per month over the past three months, because more people from the inactive labour force started working or started looking for work. This number was higher than the number of employed and unemployed who left the labour market.

In order to enable comparison of cyclical movements in the labour market between countries, the unemployment indicator of the International Labour Organization (ILO) is taken as a measure. According to this indicator, the ‘unemployed’ includes all persons who do not have paid work but who have been looking recently and who are immediately available.

This covers the population aged 15 to 74 years. Between March and August 2020, the unemployment rate rose from 2.9 to 4.6 percent. After that, it declined almost continuously to 3.1 percent in July 2021. In August, 301 thousand people were unemployed, slightly increasing the rate to 3.2 percent of the labour force.

Aside from the unemployed, there are also semi-unemployed who have either recently looked for work (but are not available) or are immediately available (but have not looked), as well as part-timers who want to work more hours.

These groups fall outside the unemployment definition, but are counted towards the unused labour potential. After a temporary increase during the first period of the coronavirus crisis, in the second quarter of 2020, the total unused labour potential decreased significantly last year. In Q2 2021, it comprised 1.0 million people aged 15 to 74 years.

At the end of August 2021, UWV provided 212.7 thousand WW benefits. This is 11.6 thousand fewer than at the end of June (-5.2 percent). The number of WW benefits has fallen for seven months in a row. It is customary for the number of benefits to decrease during the summer months.

The relaxation of contact restrictions and the favourable economic situation probably also play a role. The number of WW benefits is now considerably lower than at the end of February 2020, before the start of the coronavirus crisis. At the end of February 2020, there were 240.2 thousand WW benefits.

The sharpest decline in the number of WW benefits was seen in accommodation and food services (-15.3 percent). This was also the case in the previous month (-16.1 percent). The number of WW benefits only increased in education (5.2 percent). This is common in the summer, when temporary contracts expire at the end of the school year. However, the peak in the number of WW benefits during the summer in the education sector is diminishing.

In August, the net labour participation rate reached a record high of 69.5 percent. Not all age groups show a higher rate than ever before. In August, 64.5 percent of young people (15 to 24 years) were in work.

This is less than before the coronavirus crisis, which began in March 2020. Labour participation among 25 to 44-year-olds (86.6 percent), on the other hand, was higher than before the crisis, but lower than in August 2008, when 87.6 percent were in employment. The record can therefore be attributed to the increased labour participation rate among 45 to 74-year-olds.

In August, it exceeded 60 percent for the first time. Labour participation in this group has been increasing for some time, mainly among 55 to 64-year-olds, but in recent years this has also been the case among the over-65s.

The further decline in the number of unemployed over the past three months is the result of underlying flows between the active, unemployed and inactive labour force.

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