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Could Denmark ease key work permit rule for foreigners?

Several political parties in Denmark have suggested they favour reducing a minimum salary requirement used to assess work permit applications.

Reports in Denmark suggest a parliamentary majority could favour a reduction of a key salary requirement used to grant work permits for non-EU nationals.
Reports in Denmark suggest a parliamentary majority could favour a reduction of a key salary requirement used to grant work permits for non-EU nationals. Photo by Christin Hume on Unsplash

Conservative parties and the Social Liberal (Radikale Venstre) party favour a reduction to Denmark’s pay limit scheme or beløbsgrænse, which sets a minimum salary which businesses must pay skilled non-EU nationals in order for the employee to qualify for a Danish work permit.

The government is currently negotiating with parliament over potential solutions to labour shortages.

Although previous attempts to reduce the pay limit scheme failed to make it through parliament, there now appears to be a potential majority in support of it, news wire Ritzau reports.

In 2019, the Social Liberals said they wanted to cut the minimum salary required for non-EU skilled professionals to qualify for working and residency permits (beløbsgrænse) from 417,800 kroner to 325,000 kroner per year.

The governing Social Democrats have opposed the change, arguing that it would make it less attractive for companies to hire from the Danish or EU labout markets.

But Prime Minister Mette Frederiksen suggested in her New Year speech that the government could now be prepared to reconsider the matter in light of the national labour shortage.

READ ALSO: Could small Danish companies become more likely to hire foreign staff?

News wire Ritzau reported on Wednesday that, along with the Social Liberals, some conservative parties also favour a reform to the pay limit system, suggesting a majority is achievable.

Business organisations have also long called for the minimum salary to be reduced to enable more skilled labour to be attracted from abroad.

Such a move also makes sense from a Danish perspective, an expert told Ritzau.

“If you reduce the (pay) limit, it will be easier to bring foreign labour from outside the EU to Denmark. What must be ensured is that this is done on the same (working) conditions we have in Denmark,” Roskilde University professor of Social Scences Bent Greve told the news wire.

Greve noted that previous experience with hiring from abroad showed several examples of successful integration.

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WORKING IN DENMARK

Demand for labour remains high in Denmark with employment up for 14th straight month

Denmark’s labour market remains on a trend which has seen the number of people in paid employment in the country grow month-on-month since early 2021.

Demand for labour remains high in Denmark with employment up for 14th straight month

New data from national agency Statistics Denmark shows that the number of people in paid employment increased by 16,000 between February and March this year and now stands at 2,947,000. The data is corrected for variations caused by work that is season-dependent.

The new figures represent the 14th consecutive month in which the number of people working in Denmark has increased.

Additionally, more people are in work now compared to just before the Covid-19 pandemic hit, with a knock-on effect on the economy and jobs.

145,000 more people are hired now than just before the Covid-19 crisis, senior economist with Sydbank, Mathias Dollerup Sproegel, told news wire Ritzau.

“The labour market continues to be a ray of sunshine in the Danish economy,” Sproegel said.

“Aside from record-high employment, unemployment is also close to the record-low from before 2008. That tells us that the labour force has been strengthen somewhat in recent years,” he said.

“That is due to earlier political reforms and an active effort to bring all available hands in the Danish economy into play,” he said.

READ ALSO: How Danish work permit rules are keeping out skilled foreigners living in Sweden

Another analyst, senior economist Lars Olsen with Danske Bank, said the figures evidenced that it is still possible to find staff to fill the many available positions on the labour market.

“This suggests that there are still reserves to draw on, probably among students and people who have not previously had a strong connection to the labour market,” he said in a written comment.

“It would also seem to help that the age of the state pension has been put up again this year, so nobody will reach pension age during the first half of this year,” he said.

READ ALSO: Could Denmark delay plan to increase retirement age?

Hotels and restaurants are among sectors which saw the strongest growth in employment in March, with over 5,500 new hires giving an increase of 4.6 percent.

Culture and leisure also saw notable growth at 3.3 percent or 1,900 people.

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