Business confidence higher at start of third quarter

The sentiment indicator reached a record high of 18.4 at the start of Q3 2021. This is more than 16 points higher than one quarter earlier, when business confidence was positive for the first time since the outbreak of the coronavirus pandemic. Entrepreneurs were more positive about the results achieved in the past quarter than at the beginning of April. They also had more positive expectations for the three months ahead. The Netherlands was in its second phase of lockdown in Q2 2021, but coronavirus measures were relaxed starting on 26 June and few restrictions remained in place. The measures were tightened again on 10 July in response to rising rates of coronavirus infections.

Greatest confidence boost in accommodation and food services

Business confidence rose in almost all sectors and entrepreneurial positivity was high. The general pessimism among entrepreneurs in accommodation and food services made a U-turn: at the start of Q3 2021, this was the most optimistic sector in the Netherlands. These entrepreneurs had been the most pessimistic group for the previous five quarters in a row. Turnover projections in accommodation and food services were more positive at the beginning of July. Entrepreneurs in this sector also indicated that total turnover and the economic climate had improved over the previous three months. The sector was still shut down due to coronavirus measures at the beginning of April.

As in the previous quarter, entrepreneurs in the construction sector were positive, although business confidence declined slightly. Some entrepreneurs in the real estate sector (renting, buying and selling) were positive while others were negative, resulting in a net balance.

Staff shortages more common

Each quarter, the Business Survey asks about obstacles entrepreneurs are facing in production processes and in business activities. At the beginning of Q3 2021, 32 percent of entrepreneurs reported no obstacles to their operations. Around 23 percent reported staff shortages as the most common obstacle at the beginning of the third quarter, which is more than double the average for the same period in the years 2012–2020.

In all sectors the percentage of entrepreneurs struggling with staff shortages at the beginning of July 2021 was higher than the long-term average. The business services sector reported the most pressing lack of available personnel. More than 35 percent of entrepreneurs in this sector, which includes temporary employment agencies and car rental companies, experienced staff shortages as a primary obstacle. The number of entrepreneurs in accommodation and food services facing staff shortages was more than three times higher than the long-term average. The number of entrepreneurs reporting staff shortages also increased relatively strongly in the retail trade and cultural sectors.

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