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WORKING IN DENMARK

Danish companies demand political pledge for 50,000 new staff

A major business interest organisation in the Danish private sector has urged the winners of the upcoming election to ensure at least 50,000 new workers on the country’s labour market.

Danish companies demand political pledge for 50,000 new staff
Many private sector industries in Denmark are short of skilled staff. File photo: Mads Claus Rasmussen/Ritzau Scanpix

Danish private sector industries say they are still desperate for staff, highlighting that labour shortages continue to impact both the private and public sectors.

Shortages in the health and social care sectors have been highlighted during the ongoing election campaign.

The private sector – through the voice of the Confederation of Danish Industry (Dansk Industri, DI) – told broadcaster DR on Friday that it wants whoever wins the November 1st election to pledge measures aimed at attracting 50,000 additional pairs of hands for private companies.

The last six months has seen Danish companies fail to fill advertised job vacancies 13,000 times, according to DR.

A lack of staff is resulting in businesses turning down orders and thereby missing out on revenue.

READ ALSO: Could Denmark’s election result affect work permit and citizenship rules?

By setting out policy to address the situation at the beginning of its term, a new government could achieve much to tackle the problem over a four-year period, DI says.

“This problem is not going away. Even in a time with war in Europe, an energy crisis and bulging inflation, we still need labour for businesses,” DI’s director Lars Sandahl said to DR.

Employment minister Peter Hummelgaard recognised the issue without making any specific promises.

“We are very prepared for it to be a Social Democratic-led government’s project to work for an provide continued increased employment in Denmark, fewer unemployed, and overall that we acquire the qualified labour that many industries need,” he said.

An additional 10,000 people were hired in Denmark in August, following a drop in the employment number in July which went against the general trend of high employment and shortage of labour.

There were 10,300 more people working in August than in July, with July’s number 5,000 lower than June, according to Statistics Denmark.

The July drop-off followed 17 consecutive months of rising employment.

This summer saw Denmark approve, after protracted negotiations, a reform to its Pay Limit Scheme, a criteria system used to grant work permits to non-EU nationals.

The agreement means that Danish companies can now hire skilled foreign staff on contracts paying an annual salary of 375,000 kroner, and that the foreign employees can be granted work and residence permits on that basis. The new pay limit is a 16 percent decrease from the previous 448,000 kroner. As such, skilled foreign labour can be recruited at a lower cost to companies.

While business organisations welcomed the deal at the time (and trade unions criticised it for potentially impacting Danish wages), they later said it did not go far enough to alleviate the country’s labour shortage.

READ ALSO: How can you get a work permit in Denmark if you are not an EU national? 

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WORKING IN DENMARK

Why are Danish experts recommending closure of all job centres?

Recommendations made by an expert commission to the government on employment and welfare advocate for closure of all municipal job centres.

Why are Danish experts recommending closure of all job centres?

Denmark’s job centres, which are responsible for administration of social welfare benefits for people seeking employment and of facilitating training and work placements under welfare lows, should be closed according to recommendations handed to the government on Monday.

Additionally, over half of the current rules related to unemployment benefits should be scrapped and 9 in 10 sanctions for people who fail to comply with criteria such as attending meetings or applying for a set number of jobs.

Denmark has two broad tiers for those out of work: dagpenge, which provides an income calculated on the person’s tax payments while in employment, and the more basic kontanthjælp.

Dagpenge is available to people who a paying members of a semi-private uninsurance provider called an Arbejdsløshedskasse or A-kasse, while kontanthjælp is available to everyone.

Both groups must comply with legal requirements related to job searching in order to receive the benefits they qualify for – these are administered by municipal job centres.

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When the coalition government took office at the end of 2022 it stated that it wanted to save three billion kroner annually by reforming the municipal unemployment area and improving its efficiency – specifically by targeting job centres.

This has led to an expert group, appointed by the government, making six specific requirements – those announce on Monday.

The government is not obliged to follow the recommendations.

But the expert group says there is much to gain from closing job centres.

“There’s great potential in replacing the current one-size-fits-all system with a new approach where individual needs are in focus,” group chairperson Claus Thustrup Kreiner said in a press statement.

The six broad recommendations are as follows:

  • Fewer target groups and special rules
  • Individual programmes
  • More balanced sanctions system
  • Abolish job centres and introduce free organisation at municipalities
  • Give more influence to A-kasse and private interests
  • Results, not system-based approach

|Source: DR

“Our report includes recommendations for the biggest reform of the jobseeking area ever, and will make the system cheaper, simpler and more dignified without weakening employment,” Kreiner said.

The national confederation for trade unions, Fagbevægelsens Hovedorganisation (FH), criticised the costcutting element of the recommendations in comments to broadcaster DR, and also said it would reduce the options and rights of jobseekers.

“I thought this was about giving unemployed people more freedom to decide what they need,” FH chairperson Nanna Højlund said.

“But the expert group clearly sees it as being about allowing municipalities to do exactly what they want,” she said.

The Confederation of Danish Industry (DI) welcomed the proposals.

“The expert group has proposed a simplification of employment with fewer rules and benefit categories and with a large saving” DI deputy director Steen Nielsen said in a statement.

“That is a good idea because it’s difficult to run a job centre efficiently with the many different criteria and rules that must be met for each of the many categories,” he added.

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