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Dutch salaries to increase by 2.5% in 2021, according to Willis Towers Watson data

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December 10, 2020

Fewer private sector pay freezes planned as optimism creeps back in 2021

AMSTERDAM, December 10 2020 — Dutch private sector workers are set to receive an average pay rise of 2.5% in 2021, which is a cautious improvement over the 2.1% given this year, according to salary research from Willis Towers Watson, a leading global advisory, broking, and solutions company.

The global pandemic forced many companies to revise their planned pay rises downwards earlier this year, and also to implement pay freezes and other financial controls in order to survive.

In a further sign of some optimism for next year, the survey found that the number of Dutch companies freezing their pay rates is also expected to fall sharply in 2021. This year four in ten (40%) businesses froze their pay increases, but this is forecast to fall to almost one in seven (15%) of firms in 2021.

Many companies are looking ahead to 2021 with cautious optimism, which is reflected in slightly higher pay rise budgets than we saw this year.”

Angel Hoover,
Head of Benelux

Angel Hoover, Head of Willis Towers Watson Benelux, said: “After a difficult year for employers and employees – battling lockdowns, employee safety issues, working from home and declining revenues – many employers are finding ways to handle the crisis better, manage their businesses and help their employees with a more focused work and reward strategy. Many companies are looking ahead to 2021 with cautious optimism, which is reflected in slightly higher pay rise budgets than we saw this year.”

A similar picture is emerging across Western Europe, most organisations in the major economies anticipating higher pay rises in 2021 than this year. The largest increases are expected in Germany and the UK (2.4%), followed by Italy (2.1%), France and Spain (2%).

Willis Towers Watson’s latest Salary Budget Planning Report, which studies the size of pay budgets at firms, showed that pay rises in 2021 will vary between industries, reflecting their different pandemic experiences and their recovery plans.

In The Netherlands, the weakest industries in terms of salary expectations are Energy and Natural Resources and Consumer Products, both predicting an average pay rise in 2021 of 2.2%, followed by Financial Services and Automotive (2.3%). The top three industries which are expecting more generous rises are: Retail and Pharmaceutical and Health Sciences (2.8% both) and High Tech (2.6%).  

“Not all industries have been impacted in the same way and we see differences within industries too. Many e-retailers have been successful and awarding high increases whereas more traditional retailers are awarding very little or no increase at all. Also companies in the hospitality, leisure and airline industries have suffered. The differences in how companies were impacted by the pandemic are likely to be heavily reflected in pay rise levels too,” said Hoover.

A similar overall average pay picture is emerging across Western Europe and the globe, with most organisations in major economies anticipating higher pay rises in 2021 than 2020.

Western Europe salary increases (average)

Willis Towers Watson, Salary Budget Planning Report, December 2020
Country 2020 (awarded) 2021 (budgets)
Netherlands 2.1 2.5
Belgium 1.3 2.3
UK 2.2 2.4
Germany 2.1 2.4
France 1.8 2.0
Italy 1.8 2.1
Spain 2.0 2.0

Global salary increases (average)

Willis Towers Watson, Salary Budget Planning Report, December 2020
Country 2020 (awarded) 2021 (budgets)
United States 2.3 2.7
Canada 2.2 2.6
China 4.7 5.4
Japan 1.7 2.0
India 5.9 6.4

About the Survey

The Salary Budget Planning Report is compiled by Willis Towers Watson’s Data Services Practice. The survey was conducted online in October/November 2020, receiving over 18,000 sets of responses covering over 130 countries worldwide. In The Netherlands 321 businesses took part.

The report summarises the findings of Willis Towers Watson’s annual survey on salary movement and reviews practices as a means of helping companies with their compensation planning for 2020 and beyond.

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