30 percent of part-time self-employed people want to work more hours

APRIL-MAY 2021 | 7

30 percent of part-time self-employed people want to work more hours

The Netherlands is home to one and a half million self-employed people, or zzp’ers (zelfstandige zonder personeel, i.e. a selfemployed person who works alone). A survey conducted by the Central Bureau of Statistics (CBS) found that more than 30 percent of those who are self-employed want to increase their working hours. In the second to fourth quarter of 2020, an average of 32 percent of those selfemployed working less than 20 hours per week wanted to work more hours. In the same quarters in 2019, this was only 25 percent. For part-timers who worked 20 to 35 hours, these figures were 20 percent for 2020 and 17 percent for 2019.

Considering the recent economic disruptions due to the global pandemic, it is clear that this group of people is one of the most vulnerable. Last year, approximately 895,000 self-employed people worked full time, a decrease of 44,000 compared to the same period in the previous year. According Het Parool, ‘self-employed people receive fewer assignments … One in three self-employed persons now works less than 20 hours a week’. Especially people working in creative, linguistic, technical, and administrative professions need more work assignments and thus more hours. People who were previously self-employed in the entertainment industry now have fewer contact hours and income opportunities.

The self-employed have experienced widespread income losses during the crisis. This has caused financial distress, doubled by uncertainty over future business projects, within the midst of the pandemic. The various government support schemes were inadequate to address the worries of this group. Most importantly, the government only supplemented the income of self-employed people up to the level of the standard unemployment benefit, about 1500 euros per month; and those whose partners are still in work, get nothing at all. For example, a self-employed person who previously earned 8000 euros a month, and whose partner makes 3000, now receives nothing. Obviously, for selfemployed people with mortgages, this is a disastrous reduction in income. It’s also not fair in comparison with people who are in employment, since they still receive 85% of their wage through the NOW scheme.

CBS spokesman Peter Hein van Mulligen stated that ‘salaried employees may also have less work, but self-employed people notice this immediately and much more intensely’, as the latter need to provide a service to receive an income. Even in normal times, self-employed individuals have less entitlement to social services as compared to other workers and they are at risk of receiving little to no unemployment benefits. Therefore, their livelihoods depend on the income they actively bring into their household.

With fewer hours of work and more constraints on jobseeking during the pandemic, it is clear this issue needs to be addressed with immediate effect. Last year, a committee on the regulation of work, the Borstlap Committee, advised the cabinet to give more security to flexible workers and less to employees with permanent contracts. According to the committee, there is a vast difference in rights enjoyed by individuals who are employees, as compared with flex workers and freelancers. The labour laws and taxation systems must be changed to reduce these differences. The Borstlap Committee stated that if these unjust differences are not addressed, the long-term prosperity for the self-employed will be negatively affected, especially considering the economic effects of the global pandemic.

Written by Nicole Kerr

House prices see the fastest rise in twenty years in February

As home owners, we have always been keen watchers of the house price movements in the Netherlands. More so being expats with a short-term horizon. When the corona crisis hit, dwindling tourism, faltering businesses and falling jobs numbers looked like impending doom for the housing market. We too braced for stagnation or, worse, a drop in house prices. All of a sudden we started fearing a replay of the scenes of global financial crisis of 2008, when we lived in California, and where home prices got slashed by 3040%. Announcements of foreclosure and short-sell popped up everywhere.

As months dragged on under the pandemic, counter-intuitive for common man and economy pundits alike, house prices not just held their ground: the house price index actually continued zigzagging ever upward.

Incredibly, the biggest year-on-year rise was recorded for the month of February 2021, when owner-occupied home prices increased by the highest margin in the last twenty years – then, like now, in the middle of health crisis. According to the figures published by the Central Bureau of Statistics (CBS) and the Land Registry (Kadaster), the sentiment regarding the housing market has not been dampened by the general gloom. Far from it: the madness in the housing market has only increased. After a minor blip in 2019, the year 2020 already saw a big upswing and 2021 only promisesfurther acceleration. In January, prices of existing owneroccupied homes rose by 9.3% compared to January of last year, followed by 10.4% in February. Many reasons are cited for the increase in demand for houses, which in turn is reflected in the price hike. The suspension of transfer tax for firsttime home buyers aged under 35 has encouraged people to move from rented to owned accommodation. Coupled with very low mortgage interest rates, this has made a purchase very rewarding at this time. In January, more than 24,500 homes were sold after the suspension of the tax for starters from 1 January. This record number was 40% more than in January 2020. In February, the number of home sales was 16,871, over 9% more than a year earlier. People wanting to upgrade to bigger houses are finding the low mortgage interest rates favourable to make the switch. In addition, the lockdown has resulted in lesser spending for entertainment and holidays, leaving more investible surplus.

While the increase in house prices is good news for around 4.4 million home owners in the Netherlands, it is also true that never before have owner-occupied homes been so expensive as now. And the prices are only rising. This is now turning into a serious barrier for most first-time buyers, preventing them from entering the housing ladder at all. In addition, there are concerns that inner cities will remain affordable only for people with high incomes. As per the CBS figures, which match a study by NVM, the Dutch estate agents’ association, since 2013 the value of homes has increased by more than 50 percent. Even so, according to NVM, about six in ten buyers now offer more than the asking price. With the scales tipped heavily towards demand against supply, the Netherlands has continued to be a seller’s market. The rising house prices are an indicator of the severe housing shortage that has been going on for over a decade. In the global financial crisis of 2008, many construction projects came to a grinding halt. This development was worsened by the underestimation of population growth - by natural increaseor immigration, as well as the nitrogen crisis of 2020 which slowed down the granting of new building permits, and the shortage of construction workers due to the low number of graduates in this field. As a result, the number of new housing developments has always lagged behind the housing requirements in this small country. This historic rise in house prices during a severe global calamity has only underlined the criticality of striking the right balance between demand and supply. With the population of the Netherlands projected to rise to 18.8 million by 2030, the need to build 845,000 houses by then is sacrosanct in order to tame the runaway housing prices. Right now, the exorbitant prices are forcing many to rent rather than own their dream home.

Written by Geetanjali Gupta