Dutch earnings from international trade
International trade in goods and services is crucial to a small, open economy such as the Netherlands. Almost one-third of Dutch GDP is earned from exports of goods and services. Exports of goods and services also generate 2.4 million full-time jobs for the Dutch population, both directly at exporting firms and indirectly at suppliers to those exporters. How did the coronavirus pandemic affect our international trade? How much are domestic exports, re-exports and service exports worth, and what is the value of the goods and services that Dutch firms imported to produce these exports? How much value added and employment does the Dutch economy gain from exports and what developments have occurred since 2015? Which destination countries provide the Netherlands with the highest earnings from its exports and on which export country do the largest number of full-time jobs depend?
6.1Key findings
The coronavirus pandemic had a major impact on the Dutch economy and on Dutch trade with other countries in 2020. The gross export value fell by 7% to €622.9 billion in 2020.noot1 Within total exports, service exports fell most sharply, by over 12%. This was primarily due to a sharp decline in tourism revenues due to the coronavirus pandemic (inbound travel falls under service exports). It is from service exports that the Netherlands earns the most per euro of exports: 63 cents per euro. That is more than it earns from domestic goods exports (56 cents) and much more than it earns from re-exports of goods (14 cents). Re-exports of goods generate more earnings than quasi-transit trade in foreign goods (1.4 cents) (CBS, 2021). Since the goods do not come into Dutch ownership, quasi-transit trade – unlike re-exports – is not included in the regular trade statistics presented in this chapter. Domestic exports concern typical products from Dutch soil (such as potatoes), but also exports of processed imports (such as chocolate produced from Ivorian cocoa beans). The Netherlands earned slightly more from one euro of domestic exports in 2020 than in the preceding five years. In the case of service exports, earnings per euro in 2020 were slightly lower than the average of the preceding five years. The data series for re-exports is very stable.
Sharp contraction of service exports took biggest toll on economy in 2020
The Dutch economy contracted by 3.8% in 2020 due to the coronavirus pandemic. The fall in exports of goods and services contributed as much as 2.2 percentage points to this contraction, exceeding the negative contribution from domestic expenditure (1.6 percentage points). The fall in service exports alone contributed as much to the contraction of the Dutch economy in 2020 as the fall in all domestic expenditure combined. The fact that exports were hit harder than the Dutch economy as a whole during the first COVID year 2020 is also reflected in the decreased share of total export earnings in GDP. The export share decreased from 33.3% in 2019 to 31.8% in 2020.
Business services generated the highest export revenues in 2020
Of all sectors, manufacturing traditionally earns the most from Dutch exports, with the bulk of the earnings coming from domestic goods exports. Within manufacturing, the main earners are the food, beverages and tobacco industry, the machinery industry and the chemical industry. After manufacturing, trade (particularly wholesale through re-exports) is the biggest earner from Dutch exports. Due to the fall in tourism resulting from the coronavirus pandemic, the biggest contraction in export earnings in 2020 was in business services, which include travel intermediaries and platforms for travel and holidays. Accommodation and food services and the transport sector were also hit by lower expenditure by foreign visitors to the Netherlands.
Higher earnings from exports to China despite the coronavirus crisis
Germany has been the Netherlands’ main export destination for many decades. Exports to our eastern neighbours accounted for 6% of Dutch GDP in 2020. Earnings from Germany nevertheless fell by 7% (€3.4 billion) compared to 2019. Earnings on exports to China actually increased in 2020, partly as a result of higher sales of Dutch baby milk powder and pork.
As much as 68% of imports of goods and services is ultimately destined for countries abroad: 40 percentage points relate to re-exports of goods and 28 percentage points relate to imports of raw materials, semi-finished products and support services incorporated in goods and service exports.
Exports provided 2.4 million direct and indirect full-time jobs in 2020, accounting for 30% of total employment in the Netherlands. 17% of this employment was attributable to goods exports, 13% to service exports. Direct exports provided 1.1 million full-time jobs and indirect exports a further 1.3 million full-time jobs.
The final section shows the extent to which various occupations are linked to exports. It shows, for example, that people in agricultural occupations work more than half of their hours for foreign consumption. Highly educated people also work relatively more (34% of the total number of hours worked by highly educated people) for exports than lower skilled people (28% of the total number of hours worked by lower skilled people).
6.2Contribution of exports to GDP
The Netherlands exported €622.9 billion worth of goods and services in 2020. Figure 6.2.1 shows that this gross export value is the sum of exports of goods produced in the Netherlands, re-exports and service exports. Re-exports consist of goods imported by the Netherlands and then re-exported after virtually no processing, with the goods having been under Dutch ownership. Compared to 2019, the gross export value was €48.2 billion lower, a decrease of 7%. This decrease was largely attributable to the coronavirus pandemic, which impacted the Dutch economy from March 2020. It is notable, however, that the decline in Dutch exports was smaller than that seen in other OECD or EU countries (OECD, 2022; Kutlina-Dimitrova et al., 2021).
| Jaar | Domestic exports | Re-exports | Service exports |
|---|---|---|---|
| 2020 | 213.7 | 249.9 | 159.3 |
| 2019 | 232.0 | 258.3 | 180.8 |
| 2018 | 239.3 | 245.6 | 170.5 |
| 2017 | 227.5 | 233.3 | 154.8 |
| 2016 | 209.5 | 211.4 | 142.5 |
| 2015 | 212.1 | 206.3 | 152.0 |
Service exports hit hardest by coronavirus
The bulk of gross export value in 2020 came from exports of goods, €213.7 billion of which consisted of domestic exports and €249.9 billion of re-exports.noot2 Exports of services represented a smaller share, with a value of €159.3 billion. Service exports declined most in the COVID year 2020, by 12%, followed by domestic exports (–8%) and re-exports (–3%). Within service exports, travel (expenditure by foreign visitors to the Netherlands) was hit particularly hard by the coronavirus pandemic. In 2020 as a whole, expenditure by foreign tourists and business travellers in the Netherlands halved compared to 2019 (Poulissen et al., 2022). Travel thus accounts for around 46% of the total decrease in gross service exports in that year (CBS, 2022).noot3 Of the three export components, re-exports experienced the strongest medium-term growth. Between 2015 and 2020, re-exports increased by 21%, service exports by 5% and domestic exports by just 1%.
Service exports are most profitable
The Netherlands is strongly represented in global value chains. Imports are important, for example, for our own production of goods and services for exports (see for example Lammertsma & Notten, 2019; Aerts et al., 2020; Notten et al., 2021; Bohn et al., 2022). Raw materials and semi-finished products are imported into the Netherlands and then incorporated in Dutch export products. Another example concerns foreign service providers that facilitate Dutch exports. To determine what the Netherlands earns from exports, as a contribution to GDP, the consumption of the required goods and service imports must be deducted from the gross export value. On average, the Netherlands earned 41 cents for every euro of goods and services exported in 2020. That is slightly less than in 2015 (42 cents), partly because of the strong growth in less profitable goods re-exports, as earnings per euro of exports vary significantly from one export category to another (Figure 6.2.2). In 2020, the Netherlands achieved the highest net earnings per euro – 63 cents – from service exports. In the case of domestic exports, the figure was 56 cents per euro and for re-exports 14 cents.noot4 The low export earnings from re-exports are due to the large import component in this goods flow: the contribution from Dutch firms to these exports is limited. Earnings per euro of exports remained relatively stable for all types of exports over the years. Earnings from domestic goods exports, at 56 cents per euro, were nevertheless higher in 2020 than in the preceding five years.
| Type export | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 |
|---|---|---|---|---|---|---|
| Domestic exports | 52.5 | 53.3 | 52.1 | 51.3 | 53.8 | 56.1 |
| Re-exports | 13.7 | 14.1 | 13.9 | 13.5 | 13.5 | 13.8 |
| Service exports | 64.1 | 65.3 | 64.2 | 61.8 | 61.4 | 62.7 |
Export earnings decrease to 31.8% of GDP
After the deduction of the incorporated goods and service imports, Dutch export earnings amounted to €254.2 billion in 2020, a decrease of 6% compared to 2019 (Figure 6.2.3). The 6% decrease is the result of decreases in earnings from service exports (–10%), domestic goods exports (–4%) and re-exports (–1%).
Export earnings therefore accounted for 31.8% of GDP in 2020 (Figure 6.2.4). The bulk of the GDP (68.2%) relates to earnings from domestic expenditure. Domestic goods exports generated the highest earnings of all export categories, at €119.8 billion, followed by service exports at €100.0 billion and re-exports at €34.4 billion.
| Jaar | Domestic exports | Re-exports | Service exports | Domestic expenditure |
|---|---|---|---|---|
| 2015 | 111.4 | 28.3 | 97.5 | 452.8 |
| 2016 | 111.7 | 29.7 | 93.0 | 473.9 |
| 2017 | 118.5 | 32.5 | 99.3 | 487.8 |
| 2018 | 122.7 | 33.1 | 105.4 | 512.8 |
| 2019 | 124.7 | 34.8 | 110.9 | 542.6 |
| 2020 | 119.8 | 34.4 | 100.0 | 545.9 |
| Type of export | 2020 |
|---|---|
| Domestic exports | 15.0 |
| Re-exports | 4.3 |
| Service exports | 12.5 |
| Domestic expenditure | 68.2 |
Highest export earnings in manufacturing
Earnings from exports differ widely from one sector to another. Figure 6.2.5 shows that manufacturing generated the highest value added, namely €63.2 billion, as a result of exports in 2020. This represents almost a quarter of total Dutch export earnings. Most of this value added came from domestic goods exports. By exporting self-produced goods or by supplying industries that subsequently export domestic goods (for example in wholesale trade), manufacturing created €55.3 billion of value added. Manufacturing earned an additional €6.3 billion from exporting or contributing to exports of services, including support services. Most of the value added resulting from manufacturing exports is generated by the food, beverages and tobacco industry (€12.9 billion in 2020), followed by the machinery industry (€11.5 billion) and the chemical industry (€9 billion) (Figure 6.2.6). The only manufacturing industries that generate more value added through domestic expenditure (e.g. purchases by Dutch consumers) than through exports are the building materials industry (71%) and the furniture industry (67%).
Manufacturing earned around €2 billion less from exports in 2020 than in 2019, mainly due to a decrease in domestic exports. This was mainly due to contractions in the chemical industry (domestic exports down by €1 billion), the motor vehicle and trailer industry (–€0.4 billion), the basic metal industry and the electrotechnical industry (–€0.3 billion each). Both the machinery industry (+€0.5 billion) and the food, beverages and tobacco industry (+ €0.3 billion) earned more from domestic exports in 2020. Manufacturing also earned substantially less from service exports in 2020 than in 2019, with a decrease of €0.75 billion. This was mainly attributable to the chemical industry, the food, beverages and tobacco industry and other manufacturing.
Exports generate 72% of value added in manufacturing
Around 72% of manufacturing earnings are generated by exports of goods and services. Mining and quarrying and primary agriculture are even more export-dependent (81% and 77% respectively), but much smaller in size. Exports by mining and quarrying firms generated €2.7 billion in 2020, less than primary agriculture (€10.2 billion) and much less than manufacturing (€65.2 billion). Export earnings from all three sectors are dominated by domestic exports.
Trade most dependent on re-exports
After manufacturing, it is the trade sector (particularly wholesale) that generates the most value added from exports, at €51.8 billion (20% of the total). The wholesale trade is active not only as an exporter but also as a key supplier to exporting firms in the supply chains of other industries. It is the only industry in which re-exporting of goods plays a prominent role in generating export earnings. Re-exports have a 39% share of total export earnings, whereas the average is just 13%. Service exports are particularly important in the business services, transportation and storage, and information and communication sectors.
Largest contraction in export earnings from business services
By far the largest absolute contraction occurred in export earnings from business services. Export earnings in the COVID year 2020 were €4.6 billion lower than in 2019. In percentage terms this is a decrease of 5%. The bulk of the decrease (€3.7 billion) is due to lower service exports. This largely reflects falls in revenues of firms directly impacted by a sharp drop in the number of visitors, such as accommodation agencies, travel agencies and airlines (Poulissen et al., 2022). The transportation and storage, accommodation and food services, and mining and quarrying sectors also earned substantially less from exports in 2020 than in 2019. In accommodation and food services, income was lost because tourists stayed away from the Netherlands.
Accommodation and food services, government, construction and financial services focused on domestic market
Sectors such as accommodation and food services, construction, financial services and real estate, as well as culture and recreation, focus particularly on the domestic market. The export share of total value added is therefore considerably lower in these sectors. Logically, the Dutch government (public administration, education and care) is even more domestically focused.
| Bedrijfstak | Domestic exports | Re-exports | Service exports | Domestic expenditure |
|---|---|---|---|---|
| Agriculture, forestry and fishing | 9.6 | 0.2 | 0.3 | 3.0 |
| Mining and quarrying | 1.8 | 0.0 | 0.8 | 0.6 |
| Manufacturing | 55.3 | 1.6 | 6.3 | 24.3 |
| Energy supply, water companies and waste management |
3.5 | 0.3 | 1.0 | 9.5 |
| Construction | 0.9 | 0.2 | 2.4 | 35.9 |
| Trade | 21.7 | 20.4 | 9.7 | 53.8 |
| Transportation and storage | 4.9 | 2.8 | 15.0 | 9.8 |
| Accommodation and food services | 0.3 | 0.1 | 1.5 | 8.2 |
| Information and communication | 2.3 | 0.9 | 16.5 | 17.8 |
| Financial services and real estate activities |
4.4 | 1.3 | 9.9 | 92.6 |
| Business services | 13.7 | 4.5 | 32.4 | 55.2 |
| Public administration, education and care |
1.1 | 0.3 | 2.2 | 160.8 |
| Culture, recreation and other services |
0.4 | 0.1 | 1.0 | 13.1 |
| Industriële bedrijfstak | Domestic exports | Re-exports | Service exports | Domestic expenditure |
|---|---|---|---|---|
| Food, beverages and tobacco | 12.3 | 0.1 | 0.5 | 4.7 |
| Textiles, clothing and leather | 0.7 | 0.0 | 0.0 | 0.3 |
| Timber, paper and graphic | 2.2 | 0.1 | 0.5 | 1.9 |
| Petroleum | 1.1 | 0.0 | 0.1 | 0.3 |
| Chemical | 7.9 | 0.1 | 1.0 | 0.7 |
| Pharmaceutical | 2.2 | 0.0 | 0.2 | 0.7 |
| Rubber and plastic products | 2.2 | 0.0 | 0.2 | 0.8 |
| Building materials | 0.6 | 0.0 | 0.1 | 1.7 |
| Basic metal | 1.3 | 0.0 | 0.1 | 0.3 |
| Metal products | 3.4 | 0.2 | 0.8 | 3.5 |
| Electrotechnical | 2.9 | 0.4 | 0.3 | 0.5 |
| Electrical appliances | 1.9 | 0.2 | 0.4 | 0.8 |
| Machinery | 10.6 | 0.2 | 0.7 | 2.7 |
| Motor vehicle and trailer | 2.0 | 0.0 | 0.1 | 0.5 |
| Other transport equipment | 1.2 | 0.0 | 0.1 | 0.3 |
| Furniture | 0.5 | 0.0 | 0.0 | 1.0 |
| Other manufacturing and repairs | 2.4 | 0.1 | 1.2 | 3.5 |
Exports to Germany account for 6% of GDP
Germany has been the Netherlands’ main trading partner for many decades. The Netherlands earned €47.9 billion from direct exports of goods and services to Germany in 2020 (Figure 6.2.7), representing 6.0% of GDP. Germany is thus the most important export partner not only in terms of export value but also in terms of export earnings. The other countries in the top 5 are the United Kingdom (€24.7 billion; 3.1% of GDP), Belgium (€22.8 billion; 2.8%), France (€17.4 billion; 2.2%) and the United States (€15.6 billion; 1.9%). At 19%, the re-export share of earnings from exports to Germany is relatively large (average of 15% for the top 10 destinations). This would comprise, for example, telephones, toys and clothing that a Dutch firm imports from China and then sells on to Germany. The re-export share is even greater in the case of exports to France, Italy, Spain and Poland. For more distant destinations such as the United States (6%) and China (5%), the re-export share of Dutch export earnings is much smaller.
| Handelspartner | Domestic exports | Re-exports | Service exports |
|---|---|---|---|
| Germany | 23.2 | 8.9 | 15.8 |
| United Kingdom | 8.5 | 2.9 | 13.3 |
| Belgium | 11.7 | 3.7 | 7.4 |
| France | 8.1 | 3.3 | 6.0 |
| United States | 6.7 | 0.9 | 8.0 |
| Italy | 4.1 | 1.6 | 2.5 |
| China | 5.4 | 0.4 | 1.5 |
| Spain | 3.0 | 1.4 | 2.2 |
| Switzerland | 1.7 | 0.6 | 4.0 |
| Poland | 2.7 | 1.1 | 1.9 |
The top 10 destinations measured by export earnings also include Italy, Spain, China, Switzerland and Poland. While total export earnings increased by 1.4% on average between 2015 and 2020, earnings from China grew by 11.1% annually on average (with domestic goods highest in percentage terms). Growth in earnings from Poland was 7.9% (with service exports highest in percentage terms) and from Spain 4.4% (with re-exports highest in percentage terms). By contrast, earnings from exports to Switzerland decreased by 4.0% annually on average.
The biggest decreases in export earnings by destination between 2019 and 2020 were in exports to Germany (€–3.4 billion) and to the United Kingdom (€–3.0 billion). In both cases there is a clear link with a decrease in travel due to the coronavirus pandemic. The biggest growth was in earnings from exports to China, which rose by €0.9 billion in 2020 compared to 2019. Most of this related to domestic exports, with among other things strong growth in exports of baby milk powder and pork to China during this period (Jukema et al., 2021). Dutch baby milk powder became very popular after a health scandal in China in 2008 (CBS, 2015) and Dutch pork has become attractive in recent years due to problems in China caused by African swine fever. Chinese demand for baby milk powder and pork decreased again somewhat between 2020 and 2021 (Jukema et al., 2022).
Earnings have generally fallen faster in the case of exports to EU countries than to non-EU countries. This is partly due to a larger share of travel in exports to the EU, but another factor is that exports to China and Brazil in particular continued to grow in 2020.
Services lead the way in exports to the UK and the US
The Netherlands’ goods exports to most countries are worth more than its service exports. This pattern can also be seen in export earnings: for most countries, earnings are higher for goods exports than for service exports. Significant exceptions are earnings from exports to the United Kingdom, the United States, Switzerland and Ireland. In the case of the United Kingdom, 54% of export earnings came from exports of services, such as business services and transport services. The corresponding figure for the United States was 51% and for Switzerland 63%. Ireland, in 12th place, shows the highest percentage, with 73% of the €3.5 billion of Dutch export earnings from that country coming from service exports. See Chapter 4 of this publication for further information on the types of services that the Netherlands imports and exports and the main partner countries.
Analysis of the contribution of exports to the GDP contraction
Since almost one-third of gross domestic product comes from exports of goods and services, exports are frequently described as the growth engine of the Dutch economy. Figure 6.2.8 shows the growth contributions made by the various export categories to GDP volume changes. The Dutch economy contracted by 3.8% in 2020. Exports of goods and services accounted for 2.2 percentage points of this contraction, with the remaining 1.6 percentage point resulting from domestic expenditure, such as household consumption, government expenditure and investments. The contribution of exports to the negative GDP growth was due mainly to the decrease in exports of services (1.6 percentage points). The contraction in domestic goods exports contributed 0.5 percentage points to the economic contraction in 2020, while lower re-exports contributed 0.2 percentage points.
Contribution of exports to GDP volume growth: the international method versus the method corrected for imports
GDP according to final expenditure equals the sum of final consumption, investments and exports of goods and services minus imports of goods and services (trade balance). To determine the contribution of the trade balance to GDP volume growth, the contribution of imports is subtracted from that of exports. This is the internationally agreed method for compiling National Accounts. However, the internationally agreed method underestimates the contribution of exports to GDP and overestimates the contribution of domestic expenditure. This is because it does not take into account the fact that goods and services are also imported for domestic expenditure. To gain a more accurate picture of the contribution to growth by type of export, this chapter presents figures on the contribution to GDP volume growth with imports being allocated to all final expenditure categories. This is done using input-output analysis according to the method developed by Kranendonk and Verbruggen (2008).
| Year | GDP growth | Domestic expenditure | Service exports | Re-exports | Domestic exports |
|---|---|---|---|---|---|
| 2016 | 2.2 | 2.2 | -0.7 | 0.2 | 0.5 |
| 2017 | 2.9 | 1.2 | 0.8 | 0.3 | 0.6 |
| 2018 | 2.4 | 1.3 | 0.6 | 0.1 | 0.3 |
| 2019 | 2.0 | 1.4 | 0.4 | 0.1 | 0.1 |
| 2020 | -3.8 | -1.6 | -1.6 | -0.2 | -0.5 |
6.3The importance of imports of goods and services
68% of imports are ultimately destined for export
Imports of goods and services amounted to €540 billion in 2020 (Figure 6.3.1). Imports of goods and services thus contracted even more sharply than exports of goods and services: 9% compared to 7%. With a value of €369 billion, 68% of imports of goods and services in 2020 were intended for exports of goods and services, either as imports for re-export (40 percentage points) or as imported raw materials, semi-finished products and support services incorporated into goods and service exports (28 percentage points). In 2015, this share was 64%, but between 2017 and 2020 it remained fairly stable. In short, around one-third of Dutch imports of goods and services are destined for the domestic market.
| Jaar | Domestic exports | Re-exports | Service exports | Domestic expenditure |
|---|---|---|---|---|
| 2020 | 93.8 | 215.5 | 59.4 | 171.0 |
| 2019 | 107.3 | 223.4 | 69.8 | 190.8 |
| 2018 | 116.6 | 212.5 | 65.2 | 179.6 |
| 2017 | 109.0 | 200.8 | 55.5 | 170.9 |
| 2016 | 97.9 | 181.6 | 49.4 | 162.1 |
| 2015 | 100.7 | 178.0 | 54.5 | 185.4 |
Figure 6.3.2 shows the import content in each export category, i.e. the share of imported goods and services in the export value. It indicates the proportion of (gross) export revenues that leak away to other countries in the form of costs for necessary imports. This indicator is also known as a vertical specialisation measurement. It is actually the opposite of the value added per euro of exports created in the Netherlands (Figure 6.2.2). For total exports of goods and services in 2020, the import content was 59.2%; in 2015, it was 0.8 percentage points lower. Exports of services require the smallest amount of imports, 37.2% of the export value, but this share is rising; in 2015 it was 35.9%. In 2020, 43.9% of domestic exports consisted of processed imported goods and services. That is 3.5 percentage points less than in 2015. In the case of re-exports, which make up a large share of the total export value, the import content was 86.2% in 2020, almost the same as in 2015.
| Type export | 2015 | 2019 | 2020 |
|---|---|---|---|
| Domestic exports | 47.5 | 46.2 | 43.9 |
| Re-exports | 86.3 | 86.5 | 86.2 |
| Service exports | 35.9 | 38.6 | 37.3 |
6.4Employment linked to exports
A third of employment in the Netherlands is linked to exports
Exports of goods and services create jobs for the inhabitants of the Netherlands. These jobs may be linked directly to exports, in the case of employees working in the exporting sector itself, but also indirectly, in the case of those working for suppliers to exporters. Examples are caterers working for an exporting firm (indirect employment) and assembly workers working for the exporting firm itself (direct employment). The infographic on the next page shows that exports of goods and services provided some 2.4 million direct and indirect full-time jobs (FTEs) in the Netherlands.noot5 Around 30% of total employment in the Netherlands can therefore be attributed to exports. Goods exports accounted for 17% of total employment in the Netherlands in 2020, while service exports accounted for 13%. Figure 6.4.1 shows how the 2.4 million full-time jobs were generated by the various types of exports in 2020 and the extent to which they were direct or indirect jobs. If we compare 2020 with 2015, we see an increase in employment across all export categories. We see a 5% rise in indirect employment associated with re-exports. Compared to 2019, the employment created by service exports has fallen farthest, by 5%.
| Jaar | Type export | Direct employment | Indirect employment |
|---|---|---|---|
| 2020 | Domestic exports, 2020 | 430 | 617 |
| 2020 | Re-exports, 2020 | 56 | 240 |
| 2020 | Service exports, 2020 | 581 | 441 |
| 2019 | Domestic exports, 2019 | 426 | 641 |
| 2019 | Re-exports, 2019 | 62 | 239 |
| 2019 | Service exports, 2019 | 584 | 486 |
| 2015 | Domestic exports, 2015 | 385 | 580 |
| 2015 | Re-exports, 2015 | 61 | 201 |
| 2015 | Service exports, 2015 | 517 | 442 |
Exports of services provide most direct employment
In 2020, exports of goods and services generated 1.1 million FTEs of direct employment. Of this total, service exports provided the largest number of jobs, around 581,000. Exports of domestic goods accounted for around 430,000 FTEs and re-exports accounted for some 56,000 jobs. Direct employment due to exports is almost unchanged compared to 2019.noot6
Most indirect employment generated by domestic exports
In addition to direct jobs, 1.3 million full-time jobs are indirectly involved in the process of producing goods and providing services for export. Examples are jobs at suppliers, such as transport firms, caterers and accountants. Exports of domestic goods generated the most indirect jobs, making up almost half of total indirect employment. In 2020 that amounted to 617,000 full-time jobs. Exports of services generated 441,000 indirect jobs and re-exports around 240,000 jobs. With 780,000 FTEs, service industries accounted for the bulk of indirect employment due to exports. Most indirect employment was with temporary employment agencies and job placement services, legal and management consulting, and wholesale trade.
Exports created most employment in business services
In particular sectors, a large share of employment is associated with exports, while other sectors depend very little on exports for employment. Exports generated most employment in business services. The manufacturing, trade, transportation and storage, and information and communication sectors also benefit from exports of goods and services. Agriculture and manufacturing are most dependent on exports for employment in relative terms. That is mainly because these sectors are active in exports themselves. Business services depend on exports for just under half of their employment, but export-related employment is mostly indirect, which means that these jobs exist because of supplies to other exporting sectors. By contrast, public administration, education, healthcare and the cultural and recreational sectors have a low dependence on exports for employment.
| Bedrijfstak | Direct employment due to exports | Indirect employment due to exports | Employment due to domestic expenditure |
|---|---|---|---|
| Agriculture, forestry and fishing | 86 | 53 | 39 |
| Mining and quarrying | 5 | 2 | 2 |
| Manufacturing | 340 | 132 | 264 |
| Energy supply, water companies and waste managament |
5 | 16 | 40 |
| Construction | 14 | 29 | 461 |
| Trade | 127 | 290 | 723 |
| Transportation and storage | 114 | 118 | 125 |
| Accommodation and food services | 30 | 23 | 233 |
| Information and communication | 110 | 63 | 137 |
| Financial services, real estate activities |
22 | 29 | 212 |
| Business services | 190 | 493 | 843 |
| Public administration, education and care | 12 | 26 | 2018 |
| Culture, recreation and other services | 14 | 25 | 315 |
Most export-related employment due to Germany
The number of full-time jobs in the Netherlands that are linked to exports follows the same pattern as export earnings. Here too, the top 3 countries are Germany (453,000 full-time jobs), followed by the United Kingdom (239,000 full-time jobs) and Belgium (208,000 full-time jobs). In relative terms, employment supported by re-exports is highest in the case of Spain (20%), followed by France, Italy and Poland (all 18%). In the case of destinations where domestic exports play a relatively large role in export earnings, a relatively high level of employment is generated by this type of exports, as in the case of exports to Germany, Belgium and Italy, and in particular exports to China. Employment due to service exports is relatively high in the case of export destinations such as the United Kingdom, the United States and, especially, Switzerland.
| Handelspartner | Domestic exports | Re-exports | Service exports |
|---|---|---|---|
| Germany | 209 | 76 | 168 |
| United Kingdom | 79 | 25 | 135 |
| Belgium | 100 | 32 | 76 |
| France | 73 | 29 | 62 |
| United States | 58 | 8 | 80 |
| Italy | 36 | 14 | 27 |
| China | 47 | 4 | 16 |
| Spain | 27 | 12 | 22 |
| Switzerland | 16 | 5 | 37 |
| Poland | 25 | 10 | 21 |
Agricultural occupations in particular depend heavily on exports
This section examines which occupations are heavily involved and less heavily involved in Dutch exports of goods and services. Previous research (CBS, 2018) has shown that sectors in which women are well represented are less related to exports. This was ascertained by examining the number of hours worked by men and women in each sector. It can be seen that men, more than women, work in industries that are heavily dependent on exports, not only because people work in a sector that itself exports, but particularly also because every sector supplies intermediate goods and services to other sectors, which then export. This method is expanded here by basing the analysis not only on sex but also on the person’s occupation. The occupation data are taken from the Labour Force Survey (EBB).noot7 On the basis of the EBB it is possible to assess for each sector how many hours are worked and by which occupational groups. With this information it is possible to ascertain which occupations are particularly dependent on foreign demand for Dutch goods and services, and which are not.
Figure 6.4.4 shows how many millions of hours per week are worked in each occupational class.noot8 Around 31% are worked for exports of goods and services to foreign countries. The largest numbers of hours worked per week in the Netherlands are in the business and administrative occupations (53 million hours), followed by technical occupations (43 million hours). These two occupational classes also have the largest number of hours worked for exports, both around 18 million hours per week.
Agricultural occupations in particular depend heavily on exports: 57% of the hours worked per week in agricultural occupations are worked to enable exports. These hours are worked for both exports by the agricultural sector itself and for exports by other sectors that use agricultural intermediate resources for their own exports. Examples include the food industry and accommodation and food services, when a foreign guest stays in a hotel or visits a restaurant. Educational and care sector occupations are much less dependent on exports.
| Beroep | Hours worked for domestic expenditure | Hours worked for exports |
|---|---|---|
| Business and administrative occupations | 34.19 | 18.6 |
| Technical occupations | 26.18 | 16.88 |
| Health and welfare occupations | 32.64 | 2.11 |
| Sales and PR occupations | 17.38 | 9.75 |
| Managers | 10.47 | 6.45 |
| Teaching occupations | 15.92 | 0.86 |
| Service occupations | 13.08 | 3.37 |
| ICT occupations | 8.96 | 6.45 |
| Transport and logistics occupations | 7.59 | 7.32 |
| Public administration, protective services and legal occupations | 8.83 | 1.67 |
| Agricultural occupations | 2.86 | 3.79 |
| Artistic and linguistic occupations | 3.79 | 2.66 |
| Other | 0.74 | 0.63 |
Type of contract and educational level
The hours worked for domestic and foreign markets can also be analysed by contract type (Figure 6.4.5) and educational level (Figure 6.4.6). Most hours per week are worked by people on permanent contracts, where 30% of the hours worked are for exports. This proportion is the same among people on fixed-term contracts, i.e. flex workers. In the case of self-employed people, the share of hours worked for exports is somewhat greater, at 35%. This is because self-employed people fairly often work in sectors that are (directly or indirectly) dependent on exports, such as business and administrative occupations. In total, 34% of the hours in this occupational class are worked for foreign markets. If we look only at self-employed people in this occupational class, we see that around 44% of their hours worked are worked for foreign markets. This is explained by the fact that employees in this occupational class fairly often work in domestic administration and self-employed people work more often in business services, where relatively more work is for exports.
| Type contract | Hours worked for domestic expenditure | Hours worked for exports |
|---|---|---|
| Permanent contract | 121 | 51 |
| Fixed-term contract | 29 | 12 |
| Self-employed | 33 | 17 |
Highly educated people work the most hours per weeknoot9; 117 million hours compared to 42 million hours for low-skilled people.noot10 They work 28% for Dutch exports. Low-skilled people work 34% for exports. Low-skilled people often have a technical occupation (such as assembly workers and machine operators) and are more likely than highly educated people to work in industries with a higher relative share of exports, such as transport and manufacturing.
| Opleidingsniveau | Hours worked for domestic expenditure | Hours worked for exports |
|---|---|---|
| Low education level | 28 | 14 |
| Intermediate education level | 70 | 33 |
| High education level | 84 | 33 |
6.5References
References
Aerts, N., Notten, T., Prenen, L., Rooyakkers, J. & Wong, K. F. (2020). Dutch earnings from international trade. In M. Jaarsma & A. Lammertsma (Eds.), Dutch Trade in Facts and Figures 2020: Exports, investment & employment. Statistics Netherlands: The Hague/Heerlen/Bonaire.
Bohn, T., Notten, T., Prenen, L. & Wong, K.F. (2022). Diensten in dozen: de rol van indirecte dienstenexport. In D. Herbers & J. Rooyakkers (Eds.), Internationalisation Monitor 2022, second quarter: International trade in services, developments and barriers. Statistics Netherlands: The Hague/Heerlen/Bonaire.
CBS (2015). Export babymelkpoeder naar China 50 keer hoger. Statistics Netherlands: The Hague/Heerlen/Bonaire.
CBS (2018). Internationalisation Monitor 2018, second quarter: Employment. Statistics Netherlands: The Hague/Heerlen/Bonaire.
CBS (2021). Waarde en verdiensten uitgaand goederentransport in Nederland. Statistics Netherlands: The Hague/Heerlen/Bonaire.
CBS (2022). Internationale handel; invoer en uitvoer van diensten 2014–2020. Statistics Netherlands: The Hague/Heerlen/Bonaire.
Jukema, G. D., Ramaekers, P. & Berkhout, P. (Eds.) (2021). De Nederlandse agrarische sector in internationaal verband – editie 2021. Wageningen Economic Research and Statistics Netherlands: Wageningen/Heerlen/The Hague.
Jukema, G. D., Ramaekers, P. & Berkhout, P. (Eds.) (2022). De Nederlandse agrarische sector in internationaal verband – editie 2022. Wageningen Economic Research and Statistics Netherlands: Wageningen/Heerlen/The Hague.
Kranendonk, H. & Verbruggen, J. (2008). Decomposition of GDP Growth in Some European Countries and the United States. The Economist, 156(3), 295–306.
Kutlina-Dimitrova, Z. & Rueda-Cantucha, J. M. (2021). The impact of Covid-19 on exports related jobs. Chief Economist Note. European Commission: Brussels/Luxembourg.
Lammertsma, A. & Notten, T. (2019). Dutch earnings from international trade. In M. Jaarsma & A. Lammertsma (Eds.), Dutch Trade in Facts and Figures 2019: Exports, investment and employment. Statistics Netherlands: The Hague/Heerlen/Bonaire.
Lemmers, O., Rozendaal, L., Berkel, Van, F. & Voncken, R. (2014). Nederland en Internationale Waardeketens. Statistics Netherlands: The Hague/Heerlen/Bonaire.
Notten, T., Prenen, L. & Wong, K. F. (2019). Dutch earnings from international trade. In S. Creemers & M. Jaarsma (Eds.), Dutch Trade in Facts and Figures 2021: Exports, imports & investment. Statistics Netherlands: The Hague/Heerlen/Bonaire.
OECD (2022). International trade during the COVID-19 pandemic: Big shifts and uncertainty. OECD: Paris.
Poulissen, D., Rooyakkers, J. & Smit, R. (2022). De internationale dienstenhandel in woelige tijden. In D. Herbers & J. Rooyakkers (Eds.), Internationalisation Monitor 2022, second quarter: International trade in services, developments and barriers. Statistics Netherlands: The Hague/Heerlen/Bonaire.
Noten
At the time of writing, 2020 is the most recent full year for which data are available in the National Accounts.
It is stated elsewhere in this publication that re-exports account for just under half of goods exports. The figures presented in this chapter are based on figures of the National Accounts. The ownership criterion is central in the National Accounts, which means certain transactions abroad can be counted as Dutch imports and exports even if the traded goods have not physically entered the Netherlands. Partly for this reason, the volume of re-exports stated in this chapter and in Chapter 7 exceeds the volume of domestic exports.
The share shown here is based on the International Trade in Services source statistics. There are differences in the way in which the National Accounts and the source statistics have to treat Special Purpose Entities. On the other hand, the National Accounts compare service trade data with other source statistics, and inconsistencies between the sources can lead to adjustments to the source data in order to present a consistent picture of the economy as a whole. The focus on continuity in the National Accounts also leads to divergences in level between the source statistics and the National Accounts. This will be reviewed in a revision year.
In the National Accounts, merchanting trade (when an enterprise in the Netherlands acquires ownership of the goods abroad and sells them on to another foreign operator without the goods physically entering the Netherlands) is counted as re-exports. If merchanting trade is excluded, export earnings per euro of re-exports amount to 10 cents rather than 14 cents (CBS, 2021).
When determining the labour volume in full-time equivalents (FTEs) over a period, the start and end date of a job as well as the weekly working time are taken into account. Since many people work part-time, some work only part of the year and some have several jobs, the number of individual jobs is higher than the number of FTEs.
Due to a methodological change, the figures published in Dutch Trade in Facts and Figures 2021 are not comparable with the figures in this publication.
This analysis examines the occupational classes determined jointly by the Research Centre for Education and the Labour Market (ROA) and CBS. This classification comprises 13 classes: Educational occupations; Creative and linguistic occupations; Commercial occupations; Business and administrative occupations; Managerial; Public administration, security and justice; Technical occupations; ICT occupations; Agricultural occupations; Care and welfare; Service occupations; Transport and logistical occupations; Other occupations.
Employment is normally reported in terms of full-time equivalents or working years. In this case it has been decided to use the reported weekly working time from the EBB, without making any assumptions as to the size of a full-time equivalent.
To view the breakdown of the employed labour force by education level, see this StatLine table: Labour participation; key figures.
The lower education level includes primary education, prevocational secondary education (VMBO), the first three years of senior general secondary education (HAVO)/pre-university education (VWO) and lower secondary vocational training (entry level), formerly assistant’s training (MBO-1). The medium education level includes upper secondary education (HAVO/VWO), basic vocational training (MBO-2), vocational training (MBO-3), and middle management and specialist education (MBO-4). Higher education comprises higher vocational education (HBO) or university education (WO). Higher vocational education (HBO) and university education (WO) programmes include all first degree, bachelor’s and doctoral or master’s programmes as well as doctorates.