The real disposable income of households in the Netherlands was 1.0% higher in the third quarter of this year compared to the same period a year earlier. The increase is primarily attributed to a rise in employee compensation due to higher collective labor agreement (cao) wages. Meanwhile, mortgage debt grew by €3.4 billion compared to the previous quarter, reaching €823.4 billion. These findings are reported by Statistics Netherlands (CBS) based on new data on household finances.
The income of both employees and self-employed individuals was higher than in the third quarter of 2022. The total compensation of employees grew by 7.2%, with job numbers increasing by 1.0% and cao wages rising by 6.3%. The mixed income was 6.4% higher. Particularly in sectors such as hospitality, healthcare, arable farming, and horticulture, the income of self-employed individuals increased.
The total received benefits increased by 10.3%, mainly due to benefits often being linked to the minimum wage, which increased by over 10% from January 1, 2023. Additionally, benefits also rose significantly due to pension indexation. However, households paid 9.2% more in taxes and social premiums.
To arrive at real disposable income, net disposable income is adjusted for price increases.
In terms of household finances in the third quarter of 2023:
- Compensation for employees played a significant role in income growth.
- Total received benefits increased substantially.
- Households paid more in taxes and social premiums.
Regarding mortgage debt:
- The mortgage debt increased by €3.4 billion compared to the previous quarter.
- The mortgage debt as a percentage of GDP decreased from 81.8% in Q2 2023 to 80.9% in Q3 2023, the lowest level since Q2 2002. This is attributed to nominal economic growth despite lower home prices and fewer home sales.