AMSTERDAM - Employers faced with rising costs and major concerns about the economic situation expect to push back harder against high wage increase demands in collective bargaining agreements next year. Wages have already risen slightly less rapidly in recent months. But ABN Amro predicts that the tight labor market will keep wage increases on the high side.
Over the first 11 months of this year, wages rose by 5 percent on average, according to preliminary figures from the employers’ association AWVN. That is still high, historically speaking, but significantly lower than last year’s average 7.3 percent increase. In the 16 collective agreements concluded in November, wages increased by an average of 4.6 percent.
“There is a slightly downward trend that is continuing,” an AWVN spokesperson told the newspaper. Most employees have now been compensated for the loss of purchasing power during the energy crisis and high inflation of 2022 and 2023 and employers are more reluctant to increase salaries significantly. “Furthermore, there are major concerns about the economic situation, especially in industry. Companies are losing their competitive position due to rising wage costs. Moreover, things are not going well in Germany, one of the most important customers.”
The AWVN expects wage increases to normalize next year. “That is really necessary. The possibilities must be examined per company or sector. Employers will then also apply the brakes when it comes to wage increases. A company can only bear the rising wage costs if productivity also increases. But that is not the case.”
ABN Amro expects that wage increases will remain high due to the tight labor market, economist Jan-Paul de Kerke told the newspaper. Companies are doing everything they can to attract and retain people. Good employment conditions are a big part of that. “Many companies are looking for staff and are, therefore, prepared to offer a higher salary. Furthermore, there are sectors where employees have not yet been fully compensated for the loss of purchasing power.”
ABN Amro expects the average wage increase to be 4.4 percent next year and 3.4 percent in 2026.
