On Tuesday 8 March 2022, the annual Economic Outlook Rotterdam (Economische Verkenning Rotterdam, abbreviated as EVR), was presented during a broadcast from the studio on Woudestein campus. This year the magazine has 4 contributions from researchers of Erasmus School of Economics and the Erasmus Center for Urban, Port and Transport Economics (Erasmus UPT).
The EVR provides insight into the most important figures, trends and developments in the Rotterdam economy. This makes the EVR an indispensable source of information for administrators, entrepreneurs, students and policymakers involved in the development of the Rotterdam economy.
Theme ‘opportunities for the circular economy’
The broadcast was dominated by the theme ‘opportunities for the circular economy. According to the researchers present, including Frank van Oort, Professor of Urban & Regional Economics at Erasmus School of Economics, and Jeroen van Haaren, Senior Researcher at the Erasmus Center for Urban, Port and Transport Economics, this theme brings to light structural challenges for Rotterdam economy. The overall tone of the outlook is positive, but at the same time a war is raging on the European continent, and that calls for restraint and caution.
Where does Rotterdam stand now?
Employment is growing in Rotterdam. In the years before corona, the economy of Rotterdam developed towards a services economy. That was positive, as it resulted from a more attractive city proposition. However, Rotterdam did not match Amsterdam and Utrecht in terms of business and consumer services. The relatively limited scope of the services sectors protected the economy of Rotterdam from the worst impacts. Services are especially vulnerable to the pandemic. Therefore, the cities with large services sectors were hit the hardest.
Companies in the Rotterdam region are particularly good in valorizing and commercializing knowledge that is being developed elsewhere. Rotterdam is a leader in one green technology field (offshore wind energy) and in other green technologies Rotterdam is building up considerable expertise (such as Hydrogen). In terms of innovation in the urban region, Rotterdam is relatively strong in digital technologies (in a broad sense), when we look at funding, startups, employees, and patent development. However, specifically for this technology, the establishment of firms lags. There is also a risk that the Rotterdam region is heavily dependent on knowledge that is developed elsewhere, especially on Blockchain and AI.
Shortages on the labour market and scarce space
Shortages on the Rotterdam labour market are large, in absolute terms in various sectors, but there is also a qualitative mismatch. Especially in technology, there are shortages and surpluses at the same time. The wrong skills, at the wrong level of education are abundant. The majority of Rotterdammers work in business economics professions, where the agility is greater, and it is relatively easier to keep up with skills. There is also a shortage of space to work. Different sectors have a different spatial demand.
Urgency of the energy and raw materials transition
The war in Ukraine is unforeseen in the outlook. It has repercussions throughout the continent. Specifically for Rotterdam, it also has significance from the point of view of the raw materials and energy transitions. The very high energy prices, but also the geopolitical dependence, make sustainable and local alternatives now relatively more attractive and more profitable. It thus increases the urgency of the energy and raw materials transition and the resulting demand (for related products, services and therefore for labour). The vulnerability posed by the dependence on totalitarian states also calls for change and an increased sense of urgency. The question is to what extent the shortages on the labour market and the scarce space for activity allow the acceleration of these transitions.