The Danish labour market situationHelsinki, May 9. - 10. 2011

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Local, regional and national level

The (municipal) Job Centers (92) Have a high degree of freedom in planning and implementing their

employment initiatives and activities Are obliged to focus on outcomes, and to achieve results which contribute to

the realization of the national and regional outcome performance

The Employment Regions (4) Are responsible for ensuring coherence between the local initiatives and the

National Employment Policies Follow up the performance outcomes of the employment measures being

pursued in the job centres

The Minister of Employment Sets the national targets and focus areas

4 Employment Regions in

Denmark

South Denmark Employment Region

1.2 million

Central Jutland Employment Region

1.2 million

North Jutland Employment Region

0.6 million

Copenhagen & Zealand Employment Region

2.4 million

Developments in the Danish Labour market

The Danish economy / labour market is facing challenges in the short and in the long term:

Short term challenges: Recovery from the recession. A question af business cycles

Long term challenges: Structure and demografi

Development in unemployment and long term unemployment 1996-2011

0,0%

2,0%

4,0%

6,0%

8,0%

10,0%

12,0%

96 98 00 02 04 06 08 10

Unemployment Long term unemployment

Developments in the Danish Labour market

The unemployment reached an all time low in July 2008 with an unemployment rate of 2,1 pct.

Because of the current economic recession, by January 2011 the unemployment rate had risen to 6,5 pct.

By March 2011: 6,1 pct. - unemployment appears to have stabilized at around 6 pct.

Denmark has lost almost 200.000 jobs in the private sector within 2 years

Unemployment by age groups 2007-2011

0123456789

10

2007

M01

2007

M06

2007

M11

2008

M04

2008

M09

2009

M02

2009

M07

2009

M12

2010

M05

2010

M10

2011

M03

Total

16-24 år

25-29 år

30-39 år

40-49 år

50-59 år

60 år og derover

Unemployment by sex 2007-2011

02468

10

2007

M01

2007

M06

2007

M11

2008

M04

2008

M09

2009

M02

2009

M07

2009

M12

2010

M05

2010

M10

2011

M03

Men Women

Structural challenges : The age-challenge

Labour market participation among the age group 60-64 years

0

1020

30

4050

60

7080

90

55-59 år 60-64 år

Pct.DanmarkSverigeNorge

Other structural challenges

Denmark has: the highest tax burden in OECD (in pct. of

GNP: 48 pct.) the highest public sector wages in OECD

countries (in pct. of GNP: 18 pct.) the highest public consumption in OECD

(in pct. of GNP: 30 pct.) the highest public expenditure in OECD (in

pct. of GNP: 58 pct.)

=> Denmark is facing large public deficits in the years to come

The government has introduced following initiatives which is expected to enhance the economy

Members of unemployment insurance funds can receive unemployment benefits for 2 years

A tax reform has given substantial tax income cuts in 2010 and 2011.

The annual financial agreements involves tax cuts and slowdown on public spending.

Restrictions on the municipalities budgets

The Danish labour market surveillance consists of:

One year forecasting of the developments in employment.

One year forecasting of the developments in unemployment.

Current Regional labour market balances describing the match between labour supply and demand for 1.100 different job titles.

All three tools are published twice a year.

The one year forecasts

Because of the current rapid developments on the labour market forecasts are only being made with a one year horizon.

The forecasts are based on the economic forecasts made by the Danish Ministry of Finance

They show the monthly and quarterly expectations to the development in employment and unemployment

Expected development

The unemployment is expected to decrease slowly during 2011

The employment is expected to stabilize / increase slowly during 2011

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The labour market balance model

Labour market balance – surveillance and frame for the tasks in the jobcenters

Survey to about 15.000 companies in the whole country twice a year

Status for about 1,100 different job categories Gives the status of shortages and surpluss of the labour

force at regional level Identify the bottlenecks – severe shortages af labour Shows in which areas mobility is needed from

unemployed, when they have less possibility to find a job

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The labour market balance model – data sources

Data on unemployment. Source: The Central Register of Labour Market Statistics CV data from Jobnet

Data on employment and job turnover. Source: Register-based labour force statistics (RAS and IDA statistics) Statistics Denmark

Data on the recruitment situation. Source: Survey among companies

Labour market balance

The labour market balances

The danish labour market is divided in 4 different regions.

Each region has its own labour market balance describing the match between labour supply and demand for 1.100 different jobtitles.

On the basis of data on employment, unemployment, job vacancies and companies unsuccessful recruiting the jobtitles are divided into different categories.

The labour market balances

Balance between supply and demand

Jobopportunities Definition

Severe and structural lack of labour

Very good job opportunities

Jobtitles with severe recruitment problems and extraordinary low unemployment

Lack of labour Jobtitles with recruitment problems and low unemployment

Mismatch between supply and demand

Jobtitles with recruitment problems and high unemployment

Balance between supply and demand

Good job opportunities Jobtitles without recruitment problems and with low unemployment

Excess of labour Limited job opportunities

Jobtitles without recruitment problems with high unemployment and few jobvacancies.

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Labour market balance – active use

Frame of planning initiatives and of the daily activities in the jobcenters and other institutions working with labour market issues

Unemployed are obliged to seek jobs with positive employment possibilities

Activation offers must target jobs with positive employment possibilities

As a tool in the dialog with the targetgroups in the employment system

Basis of the guidance dialog according to choise of education/training, especially for young people

Contact to companies starts in the ”balance”

To prevent the worst consequences of the downturn in the economy the focus of the Danish employment effort is on:

Bringing the unemployed back into job as soon as possible.

Motivating and encouraging unemployed to seek the jobs still available.

Using the labour market tools to upgrade unemployed persons with skills and knowledge in areas with good job opportunities.

Encouraging more young people to taking a formal education.