The situation in the Dutch economy remains difficult.

During the last few days, a number of reports was produced by the Dutch Central Bureau of Statistics on the Dutch economy and the Dutch mood. Generally speaking, all figures were bad, as could be expected.

Unemployment further up:

• Unemployment 25,000 up on first half of 2011
• Notable increase among 25 to 45-year-olds
• Number of job seekers in UWV database unchanged
• Marginal increase number of WW benefits 

According to the latest figures released by Statistics Netherlands, unemployment, adjusted for seasonal variation, grew by 8,000 in August 2011, reaching 421,000 or 5.4% of the labour force.

Figures published by the Institute for Implementation of Employees’ Insurances (UWV), indicate that the number of unemployment (WW) benefits rose marginally in August, whereas the number of job seekers remained stable.

Unemployment up among 25 to 45-year-olds

The number of unemployed has risen notably in the 25-45 age bracket. Over the first half of 2011, unemployment in this age category averaged 170,000, but the number increased to 186,000 in August. Unemployment growth among under-25s and over-45s was less substantial.

More new WW benefits

For the second month in a row, more new WW benefits were granted than terminated. In August this year, 32,000 new benefits were granted, a 5% increase relative to July; 30,000 benefits were terminated, over 2% more than in July. A notable increase in people resuming work resulted in more WW benefits being terminated. The number of current benefits grew by nearly 1% to 256,000.

Retail sales marginally down

Higher prices, sales down

According to the most recent figures released by Statistics Netherlands, retail sales were 0.7 percent down in July 2011 on the same month last year. Retail volume shrank by 3.5 percent, while prices were 2.9 percent higher.

Food, drinks and tobacco shops lost nearly 3 percent of their total turnover in July as volume contracted by approximately 5 percent. Prices were 2 percent higher. The effect of the shopping-day pattern was considerable. After correction for the shopping-day pattern, turnover growth was 1 percent. The loss of turnover for specialist shops was more substantial than for supermarkets.

Turnover in the non-food sector was about 1 percent down on the level of one year previously. Prices were higher, volume shrank. Chemist’s shops, DIY shops and household appliances shops had to cope with loss of turnover, but clothes shops, consumer electronics shops and home furnishing shops realised turnover growth.

Mail-order firms and online shops generated a nearly 7 percent higher turnover. Petrol stations generated 4 percent more turnover, although the volume of sales dropped.

Consumer confidence plummets

The steep drop in consumer confidence continued in September. The consumer confidence indicator fell 9 points to -30. The indicator had also dropped by 9 points in August. Such a dramatic downswing in two consecutive months is unprecedented. Confidence in the economic climate deteriorated further, willingness to buy also started to dwindle.

Consumer confidence

Consumer confidence in the economic climate has collapsed over the past months. The component indicator economic climate fell by 15 points to -53 in September. This is more than 50 points below the level of February this year. Consumers’ opinions on the economic situation over the past twelve months slumped most dramatically in September relative to August, but consumers were also far more negative about the economic situation over the next twelve months.

Economic climate, seasonally adjusted Source:CBS.nl

Willingness to buy also deteriorated in September, whereas in Augustus it had remained stable. The component indicator willingness to buy fell by 4 points to -14. Consumers’ opinions about their own financial situation were more negative and they thought the time was less favourable to buy expensive items.



Consumer confidence, seasonally adjusted Source: CBS.nl

Modest growth private sector investments

In July 2011, private sector investments in tangible fixed assets were 1 percent up on July 2010, whereas growth was zero in June. In both months, the growth of private sector investments was affected negatively by the working-day effect. July 2011 had one working day less than July 2010. June 2011 had two working days less than June last year.

Private sector investments in tangible fixed assets (volume) Source: CBS

According to September’s Investment Radar, circumstances for investments have deteriorated.

With the private sector investments, as a relative, albeit very moderate outlier, all CBS data seems to point in one direction: going down. 

This makes sense, as a number of factors is fueling the negative feelings among the Dutch citizens:

• the enduring confusion in the Euro-zone, concerning the PIIGS countries; 
• the political quarreling, lack of true leadership and indecisiveness among the European leaders; 
• the coming cutbacks at the value of €18 (€23) bln, that will be carried through by the Dutch government 
• the lagging consumer confidence that scares the same consumers; 
• the growing distrust among the large European banks. 

You could stick to the English saying: the night is darkest before dawn. But, looking at the international situation, the night seems far from over.