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Netherlands – Sharp drop in permanent jobs for the unemployed

09 March 2012

In 2011 there has been a very sharp decline of permanent contracts being issued for the unemployed as this number has gone down -97% from a year ago. Based on figures provided by the UWV, a Dutch agency where the unemployed register to claim their benefits, there were less than 2,000 new permanent contracts issued in 2011 for unemployed people.

In 2010 this figure was at 83,000 and the UWV says it cannot quite explain why this decline has been so sharp although the labour market in the country has faced a lot of economic uncertainty over what has happened in the Eurozone.

What is also striking in the UWV annual report on jobs is that the temp to perm transition has been low in 2011 as 80% of those working on temporary contracts did not get a permanent job offer once their contracts had terminated. But it may not only be the employers who are to blame for this trend as temporary workers might also decide to leave and find a job elsewhere, the report indicates. 

While permanent job contracts have declined in the year, temporary ones seem to have gone up. The UWV explains that more and more employers are less willing to invest in employees in the long term and hence the average duration of temporary contracts now last for more than a year. In 2011 these types of fixed-term or temporary contracts have gone up from 227,000 in 2010 to 368,000.

Last month the Netherlands Institute for Social Research (SCP) said that temporary contracts are “displacing” permanent contracts as it has become more common to employ temporary workers for a longer period instead of hiring employees full-time. Researcher at the SCP found that the trend to hire temporary workers has been on the increase since the late 1990s as employers recognise the flexibility of the contingent workforce.

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