Danish companies are feeling the effects of labour shortages more than ever.
An April 2021 report by Boston Consulting Group found that there will be nearly 100,000 employees shortage by 2030 for green jobs in Denmark, while Danfoss, a leading Danish manufacturer of green products says it is struggling to provide enough labour to produce the company’s green products.
“It has become clearly more difficult, and we are already fighting today to get the best candidates. We need to be very active and proactive to ensure the right competencies at all levels,” Danfoss CEO Kim Fausing said to newspaper Børsen.
Similarly, The Economic Council of the Labour Movement (Arbejderbevægelsens Erhvervsråd, AE) emphasized in a 2021 publication that Denmark will be 99,000 skilled workers short by 2030 and plans needs to be put in place now to counter these shortages.
Dansk Energi, an interest organisation for energy companies, has said Denmark probably needs more skilled workers if it is to reach the national target of reducing CO2 emissions by 70 percent by 2030.
Welfare is another sector where there is an acute demand for labour. Trade union FOA warned in its 2020 report that there will be a shortage of 40,000 social and health (SOSU) workers by 2029. The Danish Nurses’ union (Dansk Sygeplejeråd) anticipated in 2018 that there will be a shortage of 6,000 nurses by 2025.
Various organisations have suggested inviting foreign workers in response to this mounting labour shortage.
Today, foreign labour comprises a little over 10 percent of the total labour force in Denmark. According to the Danish Chamber of Commerce (Dansk Erhverv), the international workforce raised GDP by 200 billion kroner alone in 2020, corresponding to 8.5 per cent of the national GDP.
While generally opposed to easing rules on foreign workers, the government recently suggested it could be prepared to take steps to allow more foreign labour in response to the shortage.
Employment Minister Peter Hummelgaard voiced his concerns and said that new political efforts will be made to overcome the shortage while in her New Year speech, Prime Minister Mette Frederiksen said the government was “willing to discuss” the matter.
Denmark has introduced numerous schemes over the years for attracting foreign labour. These have included the pay limit scheme, green card scheme (abandoned in 2016), positive list and establishment card for international students.
Despite all these schemes, Denmark still cannot attract the international workforce it needs.
This is because Denmark has fallen significantly as a career destination for foreign employees. Denmark was in 13th place in 2014, while in 2020 it was 25th on a Boston Consulting Group (BCG) ranking for attracting foreign labour.
That makes Denmark less attractive than the neighbouring Germany, Sweden, and Norway who compete for the same foreign labour for their green transitions and economy, according to the BCG report.
There are quite a few reasons for why Denmark is continuously falling back as a career destination for foreign labour.
Strict visa requirements
Denmark has strict requirements for obtaining a work permit. The pay limit scheme, for example, makes several demands of both employers and foreign employees.
Foreign professionals must have a job offer with an annual income of 448,000, unrealistically high in many sectors. Similarly, the employer must fulfil several requirements before they can invite any foreign labour on the pay limit scheme, making it difficult for employers to hire internationals.
Unfair and retroactive immigration laws
It is a lifetime decision to migrate to a new country, especially when you have a family. One must plan for at least the next five years, while moving to a new country as a foreign employee.
This planning includes considerations of how one will be treated by the immigration laws now and in the future.
Denmark has often been the focus of international reporting on its immigration laws, and not for good reasons.
But beyond headline-grabbing stories like ministers celebrating strict immigration laws with cake or the current government stripping Syrian refugees of their residency permits and aggressive curbs on citizenship, other, less spectacular rules are making the country a turn-off for skilled foreign labour.
It can take at least ten years of your life to settle in Denmark even when everything goes as planned, only to have it all thrown up in the air by the controversial decision to retroactively apply new laws.
Broadcaster DR last year reported the case of postgraduate student Katja Taastrøm, who expected to become a Danish citizen but because of new citizenship rules applied retroactively, must now wait for at least 6 more years.
Copenhagen School of Design and Technology graduate Katie Larsen left Denmark due to strict immigration rules after living for five years in the country.
There are thousands of such stories of miseries and frustrations.
With the new discussions about inviting foreign labour, many believe it will be the start of a new era of miseries and frustrations should the current political climate of curbs on immigration and citizenship continue to be espoused by both the governing Social Democrats and the far right.
What can be done to attract foreign workers?
According to a 2017 Danish Ministry of Higher Education and Science assessment, 80 percent of foreign graduates from Danish universities leave Denmark within two years of their graduation. That number is likely to have since increased.
To bring Denmark back on top of the foreign workforce career destination list and prevent further miseries and violations of immigrants’ rights, I argue the following measures must be taken into consideration while inviting foreign workers.
- The requirements for obtaining a work permit should be easier with fewer bureaucratic procedures.
- The annual income requirement for obtaining visa and later extension should be realistic. For example, for the pay limit scheme, the income requirement should be reduced to a more realistic amount.
- A special positive list for doctors, nurses and green jobs should be introduced with a quick response rate.
Even if the above was to be granted, foreign professionals might not, at first, choose to come to Denmark, or they might leave after a few years if fairer immigration rules are not introduced. These could be:
- Foreign professionals with a job offer should be given a permanent residency permit at their arrival in Denmark, similar to rules in Canada and some other countries.
- If foreign professionals are given a limited-period visa then the rules for their visa extension, permanent residency permit and citizenship should be mentioned on their first visa offer letter and those mentioned rules should prevail until the applicant has been granted Danish citizenship.
- Retroactive implementation of rules must not take place at all.
Without fairer rules, a drive to bring more skilled foreign labour to Denmark is only likely to result in disappointment all round.
Naqeeb Khan is a research graduate of the University of Glasgow, Scotland and resides in Denmark. He is president of Green Human Resources and an executive member with the Danish Green Card Association (DGCA). He can be contacted via email.