Rabobank expects economic growth in all Dutch regions
All the regions of the Netherlands will generate economic growth this year. Growth will average 1.75%, but there will be wide regional differences. The best prospects are for the northern Randstad, and in this region particularly Het Gooi and Vechtstreek, where growth is expected to reach 2.3%.
These are the predictions of the Rabobank economists in ‘Regional forecasts for 2015 – update’ published today, 16 April. The Randstad is the conurban area in the north-west of the Netherlands which takes in the larger cities of Rotterdam, Utrecht, The Hague and Amsterdam.
Now that consumers are becoming more active, growth is no longer restricted to the primarily export-oriented regions. Economic growth is thus visible in all regions. ‘As a result of higher purchasing power and rising employment, household disposable income is rising,’ says Rabobank economist Rogier Aalders. ‘For the first time since 2008, consumers are making a substantial contribution to economic growth in the Netherlands this year. This is good news for sectors that depend on domestic spending, such as retail. Since we expect to see growth in virtually all sectors, we also expect all the regions of the Netherlands to post growth this year.’
Sectors affect growth
The growth rate will vary in each region. The northern part of the Netherlands will for instance slightly lag behind the other regions in terms of growth. Even so, the region expected to show the lowest growth, North Friesland, will still grow by 1.1%. Aalders: ‘Regions with a heavy concentration of sectors that we expect to do well this year will grow faster. For instance, the professional services sector in the region of Amsterdam is positively affecting the growth forecast of 2.1%. In regions where health care represents a relatively large proportion of the economy, we expect to see lower growth in production (production of goods and services). For example in North Drenthe, where we are forecasting production growth of 1.3%.’
Unemployment to fall in all regions
Unemployment is expected to fall in all regions, however here too there are wide variations. In Zeeuws-Vlaanderen unemployment will fall to 4%, while in Rotterdam and the surrounding area it will remain at 9%. Aalders: ‘The variations in the development of unemployment are partly due to the rate of growth of the working population. In North Drenthe for instance, the working population is increasing faster than the national average. The decline in unemployment will therefore be limited here.’
‘The same applies in Flevoland, Het Gooi and Vechtstreek, the Haarlem agglomeration and Delft and Westland,’ says Aalders. ‘The opposite is true in East Groningen, South-East and South-West Drenthe, Achterhoek, Zeeuws-Vlaanderen and North and Middle Limburg. We expect the working population to decline in these regions. This is a continuation of the trend we have seen for several years, due to ageing population, the departure of young people and a reduction in the population. Despite a relatively small increase in employment, this is leading to a sharp fall in unemployment in these regions.’