The Use of Labor Market Supplements By Central Government in the Netherlands

This paper reviews an investigation into the application of retention bonuses and labor market allowances in the central government sector in the Netherlands. On average, the supplements amount to approximately one (gross) monthly salary. They mainly accrue to males, who are highly educated, well paid, between 35 and 45 years old and who belong to the four centrally designated groups (accountants, automation experts, financial economists, and tax experts). However, there is some evidence that the efficacy of the supplements is limited. Only a small fraction of those who stayed in their job state that they would have moved if they were not awarded an addition. Moreover, people who move to another job appear to mention the content of the job as their primary motive