According to the World Economic Forum, Denmark remains one of the most competitive economies in Europe, receiving high marks for competitiveness in several areas, including innovative capacity and sustainability. When it comes to the efficiency of the Danish labour market, Denmark is second to none. The benefits of the Danish flexicurity system, with high flexibility in hiring and firing practices combined with a strong social safety net result in a Danish top position in the new 2014 edition of the Europe 2020 Competitiveness Report, published this week by the World Economic Forum. This underscores the strength of the Danish flexicurity model as a unique competitive advantage.
Trade Unions: Denmark has best working conditions
The conclusions of the World Economic Forum coincide with the International Trade Union Confederation’s (ITUC) findings that Denmark is the country in the world with the best working conditions. According to the ITUC, Denmark is the only one out of 139 countries worldwide that gets a perfect score on all parameters of whether employers treat their employees and union representatives fairly. Harald Børsting, Chairman of the Danish Confederations of Trade Unions states:
- “The study clearly shows that Denmark is a good country to work in. The Danish model, in which workers and employers generally solve their problems together, works well”. This sentiment is shared by the employers. “We are pleased that the trade union’s own survey shows that Denmark is a country with a labour market model that works,” says Pernille Knudsen, Director of the Confederation of Danish Employers.
Moving beyond the crisis
Combined, the efficiency of the Danish labour market and the strengths of the flexicurity model have allowed Denmark to cope well with the drop in employment during the Europe-wide downturn. A win-win market has been created, where employees are treated fairly and have access to high levels of state-funded social security while companies incur minimal administrative burdens when hiring and firing. Overall, the system has led to very high labour market participation, including among youth, at a time when many other European countries are struggling in this area. Moreover, the model helps the Danish workforce being one of the most productive in Europe and explains why the Danish workforce is perceived as highly motivated by foreign companies operating in Denmark.
Download the World Economic Forum Competitiveness 2020 report.
The ITUC findings can be accessed here.