Hourly rates to rise 3.8 percent less than expected in 2022
The hourly rates of flexible workers, self-employed and professionals employed by secondment agencies, rose an average of 3.8 percent in 2022. A lot less hard than predicted, under pressure of scarcity and inflation. This emerges from analysis by labor market data specialist Intelligence Group and HR-tech service provider HeadFirst Group. In 2023, they expect an average rate increase of four to six percent.
The average agreed wage increase came to 3.8 percent at the end of 2022, figures from the employment conditions advisor to Dutch employers AWVN show. The increase for professionals employed by secondment firms was significantly higher, according to The Association of Dutch Secondment Firms, they shared an average rate increase of seven percent to reflect current inflation. HeadFirst Group's hiring data matches the AWVN figures. Professionals who started a new assignment in 2022 experienced a 3.8 percent increase from the previous year. The average hourly rate of highly skilled self-employed professionals currently stands at €92.15.
Interestingly, the average growth of the realized hourly rate in 2022 is higher than the average growth of rates offered on assignments: namely 3.8 percent and 2.9 percent. In 2021, this was the exact opposite at 2.6 percent and 4 percent. Marion van Happen, CEO HeadFirst Group, explains, "This creates the picture that clients in 2022 preferred quality over the hourly rate, due to the ongoing scarcity. Parties and individuals who dare to do so keep themselves in the game and remain agile. Because despite talk of a sharp economic recession, unemployment continues to fall and employment continues to rise."
Hourly rates keep pace
Wage increases will continue into 2023, but due to inflation and profit declines among employers and fears of a mild recession, they are expected to be between 4 and 6 percent. Geert-Jan Waasdorp, director and founder of Intelligence Group says, "Still a significant growth, just slightly higher than last year, as there is a slowing effect from 2022. CBS expects a solid inflation correction in March 2023, as they include wrong variables in their analyses. As a result, the decline in purchasing power will be less than currently expected."
Professionals' hourly rates thus keep pace with collective bargaining agreement developments. "Clients are not taking rigorous steps to index rates on current assignments on a large scale. They take a performance-based approach: only professionals with good performance and an hourly rate below the market average are indexed," Van Happen said.