Dutch economy returns to more normal growth rate after quick start

Since the government started phasing out the Covid-19 restrictions, the Dutch economy has started to recover strongly. In the second quarter, the economy grew by 3.1% compared to the previous quarter. When compared to a year earlier, the second quarter of 2020 and also the low point of the pandemic, the economy grew by no less than 10%.

According to Jan-Paul van de Kerke, economist at the Economic Bureau, two factors in particular contributed strongly to the country's growth. 'Dutch consumers pulled out their wallets. This had to do with a large catch-up effect in consumption, for example by being able to go out to a restaurant or a pub once again. The extra savings accumulated during the Covid-19 crisis are also driving consumer spending. We expect consumers to use some of these savings for additional consumption. International trade is also picking up. Dutch companies can benefit from this by exporting more products'. For the coming quarters, the Economic Bureau expects robust but less solid growth. This is because the catch-up effect is diminishing in strength. 'This is also a signal that we are in more normal economic waters after the Covid-19 crisis. We expect total growth to come out at almost 4% in 2021'. 'In 2022, total growth will decrease slightly, to 2.8%', says Jan-Paul. Labour market tightness will remain a concern in the coming years. However, the current level of tightness is exceptional. There are currently more than 100 vacancies in the Netherlands for every 100 unemployed. 'Nevertheless, we expect the current level of tightness to be temporary,' continues Jan-Paul. 'Covid-19 support to companies will be phased out after the third quarter. The economy will have to adjust to a situation without support. Employees working in companies that cannot survive without aid will return to the labour market after bankruptcy. This will provide some relief to the labour market.'