Purchasing power eroded further in 2012

The purchasing power of Dutch consumers declined by 1 percent last year. Purchasing power also declined in 2010 and 2011, though less dramatically: by 0.5 and 0.8 percent respectively. In the period 1985-2012, purchasing power has never fallen so dramatically as 2012.

Purchasing power developments

Self-employed suffer most

Last year, the recession also had a downward effect on the purchasing power of many groups in the population. Employees lost 0.4 percent of their purchasing power, but with a loss of 2.7 percent, self-employed suffered most. The effects varied considerably within the category of self-employed: one tenth of self-employed saw their purchasing power being reduced by at least 29 percent in 2012, but another one tenth gained 28 percent or more.

The category benefit recipients also lost a considerable part of their purchasing power. The purchasing power of pensioners was reduced for the third consecutive year in 2012 (by 1.2 percent); people living on social security lost 1.5 percent.

Change in purchasing power if income remains stable, 2012*

People’s purchasing power declined in 57 percent of cases

If purchasing power declines, not everybody is affected. Last year, purchasing power declined among 57 percent in the Dutch population, for the remaining 43 percent the situation stayed the same or improved. Loss of purchasing power was very common among 65 percent of benefit recipients. In 2010 and 2011, benefit recipients also lost more purchasing power than employees and self-employed.

Purchasing power loss if income remains the same

Wim Bos and Linda Moonen