Long-term unemployment and the Great Recession in the Netherlands: Economic mechanisms and policy implications

Daniël van Vuuren, Albert van der Horst, H. Erken, Rob Luginbuhl, Marlies de Graaf-Zijl

Research output: Contribution to journalArticleProfessional

Abstract

A decomposition of GDP changes during the Great Recession shows that a relatively large part of the economic shock in the Netherlands translated into unemployment. Wages absorbed a larger part of the shock in Germany, the UK, and the US. The Netherlands has faced more long-term unemployment than other countries, particularly in recent years. Long-term unemployed workers are on the margins of the Dutch labour market. Neither real wages nor the number of vacancies respond to an increasing rate of long-term unemployment. Long-term unemployment is for an important part a problem of older unemployed workers. In the Netherlands, 40 % of the long-term unemployed workers are over age 50, which is almost twice as much as in the EU and the US. We identify three possible avenues for labour market reform: unemployment insurance, employment protection legislation and active labour market policies.
Original languageEnglish
Pages (from-to)415-434
JournalThe Economist
Volume163
Issue number4
DOIs
Publication statusPublished - 2015
Externally publishedYes

Fingerprint

Great Recession
Economics
Workers
Long-term unemployment
Policy implications
The Netherlands
Unemployment
Decomposition
Active labour market policy
Vacancy
Wages
Unemployment insurance
Germany
Employment protection legislation
Real wages
Economic shocks
Margin
Labour market reform
Labour market

Keywords

  • long-term unemployment
  • Great Recession
  • wage adjustment
  • unemployment insurance
  • labour market institutions

Cite this

van Vuuren, Daniël ; van der Horst, Albert ; Erken, H. ; Luginbuhl, Rob ; de Graaf-Zijl, Marlies. / Long-term unemployment and the Great Recession in the Netherlands: Economic mechanisms and policy implications. In: The Economist. 2015 ; Vol. 163, No. 4. pp. 415-434.
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Long-term unemployment and the Great Recession in the Netherlands: Economic mechanisms and policy implications. / van Vuuren, Daniël; van der Horst, Albert; Erken, H.; Luginbuhl, Rob; de Graaf-Zijl, Marlies.

In: The Economist, Vol. 163, No. 4, 2015, p. 415-434.

Research output: Contribution to journalArticleProfessional

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