Brussels’ Economy Declines by 0.5% Despite High Productivity and Increasing Housing Costs

Brussels (Eurotoday): Brussels’ economy fell by 0.5% in 2024, while Flanders grew by 1.46% and Wallonia by 0.23%. Despite having the highest productivity in Belgium, income inequality is a major issue, with GDP over three times higher than disposable income. The average rent is now €1,249, and house prices increased from €465,000 to nearly €555,000 since 2019. OECD economist Marcos Diaz Ramirez urges for growth that benefits everyone.

According to the OECD’s 2024 report, the Brussels-Capital Region’s economy fell by 0.5%, which is much lower than Flanders’ growth of 1.46% and Wallonia’s 0.23%. However, Brussels has the highest labor productivity in Belgium, meaning it produces more output for the work done. It ranks in the top 3% of OECD regions for labor productivity. Generally, capital cities in smaller countries tend to have higher GDP per capita and labor productivity because most economic activity is concentrated there.

According to OECD economist Marcos Diaz Ramirez, Brussels has many international organizations that make it productive, especially in government jobs. However, there’s a big difference between the city’s high GDP and what people take home as income, with GDP being over three times higher than disposable income. This shows that much of the wealth created in Brussels doesn’t help residents. The city also has a lot of income inequality, with rich people earning much more than the poor, making it the most unequal area in Belgium.

Brussels is facing a housing crisis, with rents and house prices rising sharply. In 2023, the average rent was €1,249 a month, almost €100 more than the year before, while the average house price increased from €465,000 in 2019 to nearly €555,000. This trend is common in big cities, where demand for housing is high. The OECD has decided to promote growth that benefits everyone, as many people are struggling with the high cost of living.