[Marxism] Notes on the Dutch economy

Jurriaan Bendien andromeda246 at hetnet.nl
Fri Jun 18 09:07:50 MDT 2004

To summarise, the Dutch economy is flat. Out of a population of 16.3 million
living in 7 million households, there were 495,000 unemployed in the second
quarter of 2004, competing for 111,000 job vacancies, which is 109,000 more
jobless than the same time last year, i.e. a whopping 25% increase.

The official unemployment rate is 6,6%, but the labour force is defined as
all those who work or are available for work at least 12 hours per week
(those who work less than 12 hours per week are regarded as unemployed) and
fully one third of all jobs are parttime jobs. There are said to be 8.3
million working persons in the Netherlands and 8.7 million jobs (fulltime,
parttime and casual), of which 60% employ men, and 40% women. The paid
labour force participation rate for men is about 75% and for women about
50%, but a far higher number of women work part-time.

Real GDP growth is flat at 0.8%. Through the 1990s, investment in industrial
production declined absolutely from 8.7 billion euro to 7 billion, and since
the end of 2002, government investment has also been reduced absolutely as
the government drastically curbed spending and reduce its debts. Foreign
trade growth (imports/exports) is also near-zero, growing at most about 1%.
Nevertheless net consumer credit outstanding is relatively low at 17 billion
euro, compared to household savings of 190 billion euro. But most of these
savings are those of the propertied classes. The bankruptcy rate is rising,
there were 6,386 bankruptcies in 2003, of which 1,151 self-employed
proprietors, and 5,235 companies. Since 2000, the value of annual output in
the sphere of production declined absolutely. Gross wage increases have
declined also: while employment contracts still averaged a 2.8% gain in
2002, in 2004 this is only about 1.7%. That means in real terms no net pay
increases at all. Income inequality is accelerating, continuing the trend of
the 1990s (for some comparisons see
http://www.sprc.unsw.edu.au/seminars/japan.pdf ).

Gross output in the Netherlands is around the 820 billion euro mark, GDP at
about 450 billion euro. The tax component of GDP is about 50 billion euro.
Compensation of employees accounts for 230 billion euro, bank services 16
billion euro and operating surplus  about 162 billion euro. In 2003, the
total net central government tax take was about 103 billion euro. Tax
charges include wage tax 28.7 billion euro, dividends tax 3.1 billion euro,
private asset tax 28 million euro, company tax 13.4 billion euro, tax on
imports and production 53.9 billion euro, social security levies on wages
425 million euro, and vehicle tax 1.6 billion euro. Adding net local
government tax of about 5 billion euro, the total net tax burden seems to be
about 108 billion euro or a quarter of GDP. Expenditure on the national debt
is 42.6 billion euro, defence spending 7 billion euro, and social security
spending about 30 billion euro. A package of 1.3 billion euro worth of tax
cuts was approved in 2002 and extended.

Agriculture and fishing employs about 100,000 (the Netherlands ranks third
worldwide in value of agricultural exports, behind the US and France),
industry 1.3 million (mainly food processing, chemicals, petroleum refining,
and electrical machinery, about a fifth of GDP), commercial trade 1.1
million (merchandise trade accounts for two-thirds of GDP),
restaurants/hotels/catering a quarter million, transport & communications
about 450,000, financial institutions 263,000. business services 1.1
million, education half a million, health one million,  and culture &
recreation just over a quarter million. Average annual labor hours in the
Netherlands is 1,362 (fulltime 1,721, parttime 952 and casual  771). About
10 billion paid hours are worked a year, and total direct gross wage income
earnt is around 200 billion euro. General government revenues from natural
gas were about $1.2 billion in 2000.

Globalisation is coming home. There are now said to be 3 million
"allochtones" (foreign-born or non-indigenous residents) in the Netherlands,
nearly a fifth of the population, of which 1.6 million are "non-Western" and
1.4 million "Western". They include 340,000 Turks, 321,000 Surinamese
295,000 Moroccans and 130,000 Antillians. Out of that 3 million, about
886,000 allochtone adults are working for pay. There is a net emigration
loss of "Western" Dutch residents from the Netherlands, whereas the net
immigration gain of non-Western people into the Netherlands is much higher.
Hence the population is becoming increasingly ethnically diverse.

The immigrant population concentrates in the four large cities. In the last
eight years, the proportion of indigenous Dutch inhabitants in the four big
cities decreased from 64% to 57% - about 89,000 indigenous Dutch moved out,
and 63,000 foreigners moved in. Because the newcomers are on average younger
and have more children, and because there are also relatively more deaths
than live births among "autochtone" Dutch people, the indigenous Dutch
population shrank relatively even more.

In Amsterdam, the number of "non-Western allochtones" has now increased to
33.5% of the total inhabitants and "Western allochtones" to 13.7%, which
means a total "allochtone" population of 47.2%. By comparison, the "ethnic"
population of London is about 29% (for the UK as a whole, 9%). In Rotterdam,
the corresponding percentages are 33.9%, 9.9% and 47.8%, in The Hague 30.4%,
12.4% and 42.8% and Utrecht 20.1%, 9.9% and 30%.

Within a few years, therefore, half of the population of the big cities will
consist of non-indigenous Dutch residents, mainly Turkish, Moroccan,
Surinamese and Antillian descent, and mainly working class. A majority of
indigenous Dutch people feel that immigration should now be restricted more.
Less than half of asylum applications are granted now, about 8,800 asylum
seekers are officially admitted a year. The influx of immigrants is however
difficult to stop, being a cumulative effect of an immigrant population
already having citizen rights in the Netherlands.


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