The average gross hourly wage earned in the Netherlands increased by 7.0 percent last year, the biggest increase in 45 years, according to figures from Statistics Netherlands (CBS). The stats office also reported that there were 52 strikes in the country last year, the highest number since 1972. The FNV workers’ union said the results last year not only show their effectiveness but also disproved the theory that continuous sharp increases in wages drive higher inflation.
The average hourly wage figure includes both collective labor agreement wages and other wages. About a quarter of employees in the Netherlands are not covered by collective bargaining agreements. The average gross earned wage increase of 7 percent last year is higher than the collective labor agreement wage increase of 5.9 percent
The increase in hourly earned wages is not only due to salary increases but also because employees get promoted or change jobs for a higher-paid position. The widespread staff shortages also mean that employers pay money above the collectively agreed wages to recruit or retain staff. The minimum wage increase also played a role. Minimum wages were, on average, 12.9 percent higher in 2023 than in 2022.
Despite the high increases, wages still lag behind inflation, which totaled 17.3 percent over the past three years. “Between 2020 and 2023, earned wages increased by 12.6 percent and collective labor agreement wages by 11.4 percent. On balance, real wages have fallen in recent years: earned wages by 4.0 percent and collective labor agreement wages by 5.0 percent.”
That is likely part of the reason for the high number of work stoppages last year. Workers went on strike 52 times, the highest number in over 50 years. “Since the first coronavirus year 2020, with 9 strikes, the number of work stoppages has increased significantly every year,” CBS said. “A total of 142,000 working days were lost last year.” Over 17,000 employees participated in strikes last year, about a thousand more than in 2022.
Dutch central bank chair Klaas Knot repeatedly addressed concerns about the prospect of a wage-price spiral last year. The economic theory suggests inflation leads to demands for higher wages, which then causes inflation to escalate in a cyclical fashion as people have more money to spend.
The price of goods and services rose by 6.5 percent last year, with food alone jumping by 12.1 percent, outpacing the average hourly wage increase. It was the plunging price of energy that kept the inflation down on the whole.
Annualized inflation fell over the course of the year, with the consumer price index rising by 3.8 percent in 2023, compared to 10.0 percent a year earlier. The rate of inflation was estimated at 2.7 percent in April, down from a peak of 14.5 percent in September 2022.
FNV union leader Zakaria Boufangacha focused mainly on the inflation rate including energy prices. “I hope that we can now say goodbye to the myth of the wage-price spiral for good. The very moderate inflation of the past period shows that this is not true.”
Still, in a statement released Wednesday by the union, the FNV vice-chair noted that many households remained at a crisis point last year. “While people worried about whether they could still afford groceries, employers and right-wing economists came up with their wage-price spiral fables and the call to moderate wages while profits continued to rise. It's a good thing we didn't respond and demanded our fair share.”
Looking back on Labor Day, Boufangacha took credit on behalf of the union for a “successful year” not only for the union and its membership, but for the working class as a whole. It proved that strikes are successful, and when people see this, they are more willing to participate and support them.
“Due to the many actions, wages showed an unprecedented increase in many sectors last year. People see that taking action pays off, and that also had a positive influence on the strike figures. The actions were a dire necessity because inflation was hitting hard, and employers did not feel responsible for compensating for this.”
The most strikes happened in industrial companies—28 strikes involving 5,000 workers, according to CBS. There were also relatively many strikes in trade—10 involving 4,000 employees. The most working days were lost in the transport and storage industry (62,000).
The most common reason to go on strike was wage dissatisfaction. At the end of 2023, CBS and TNO surveyed employees about their wages. The majority, 81 percent, said they were satisfied with their collective labor agreement wages, compared to 77 percent in 2022. And 78 percent were satisfied with their company salary, compared to 74 percent the year before.
