The days of wage rise of 6% and more are over, according to new figures from employer support organisation AWVN, which monitors pay developments.

The average pay rise in deals agreed in October was 3.6%, as economic uncertainty, geopolitical tensions and rising costs begin to impact on employer willingness to pay more.

The October figure is the lowest since August 2022. Wages have risen by an average of 5.4% so far this year, compared with 7.3% in 2023, when inflation had soared.

At the same time, however, working conditions are improving, as employers fight to keep staff due to the tight labour market, the AWVN said.

In October, 11 pay and conditions (CAO) deals were sealed, covering 30,000 workers.

Both the IMF and Dutch central bank chief Klaas Knot have warned about the impact of high wage rises. ABN Amro economists expect the final tally this year to be 6.5%, and 4% in 2025.

The FNV trade union has made 7% its target increase in the coming round of negotiations. The Dutch IMF representative Paul Hilbers said earlier this week that this would be irresponsible, given inflation has fallen.

“If wages go up too much, then prices will rise again and life will become more expensive,” he said. “No one benefits from that.”