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2021 OECD Economic Surveys: Netherlands 2021

image of OECD Economic Surveys: Netherlands 2021

Structural and institutional strengths, a strong crisis response and a high level of digitalisation have helped the Netherlands to weather the COVID-19 crisis with so far limited economic damage compared to many OECD countries. Several long-standing challenges are set to affect the strength of the recovery and its long-term sustainability. Non-standard employment is high, driven to a large extent by lower labour costs for the self-employed and other non-standard workers than for regular employees. Women are overrepresented among non-standard workers and typically work shorter hours. Households’ balance sheets, inflated by tax-subsidised housing debt and mandatory pension savings, create macroeconomic vulnerabilities and underpin inequality of assets. Landmark court rulings limiting nitrogen and greenhouse gas emissions are set to speed up a necessary green transition and led to earlier than planned closures of polluting economic activities, but have slowed down investments in infrastructure, buildings and agriculture. Embracing digitalisation is key to raise living standards further, but the social costs of skill-biased structural change, in many cases accelerated by COVID-19, must be handled firmly, notably by boosting skills and ensuring equal access to social protection.

SPECIAL FEATURE: DIGITALISATION AND PRODUCTIVITY

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A range of policies can support productivity through digital adoption in the Netherlands

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