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Karsten Dybvad: Without more workers, Denmark’s upswing will fizzle out

Private consumption in Denmark has hit record levels and 60,000 new jobs will be created over the next two years. But the upswing is entirely dependent on whether companies are able to obtain labour, says CEO of the Confederation of Danish Industry Karsten Dybvad, following a new forecast.

Publiceret: 28.02.2018
Af Karen Witt Olsen mail

The Danish economy is doing well. Really well. However, Denmark is also in dire need of hands and heads, shows a new forecast from the Confederation of Danish Industry (DI) that looks at this year and next.

“Business is full throttle. We can look forward to more than 60,000 new jobs over the next two years. This incredible development will bring about major job opportunities for Danes and money to finance society and welfare,” says CEO Karsten Dybvad, DI.

One of the things lifting Denmark’s economy is the fact that Danes have again started spending. Since 2009, Danes have tended to save up, but in 2018 and 2019 private consumption will increase by 2.5 and 2.4 per cent respectively, DI’s forecast shows.

“We are expecting the highest growth in private consumption in 12 years. That is good news, because it means that Danes can feel that it goes well for business – it goes well for them, too,” he says.

The reason that DI’s CEO is not solely applauding the forecasted developments is that the upswing is highly dependent on whether companies are able to acquire the labour they need to fill the many new jobs.

“Without more workers, the upswing will have an expiry date,” says Karsten Dybvad.

See also: Key figures: Upswing continues in Danish productivity

Denmark is at a crossroads

DI’s CEO points out that what has carried the upswing forwards thus far has been the possibilities for companies to bring in talented foreign employees from Europe in particular, as well as the fact that many more seniors are staying in the work force longer.

“Without them, the upswing would have run into the sand long ago,” says Karsten Dybvad.

As he sees it, Denmark is at a crossroads.

“Either we need more hands and heads in the labour market so that the upswing can continue. Or we will have to come to terms with a stop to public expenditure so the economy does not boil over,” he says.

See also: Key figures: Many new jobs for the unemployed

Tight control of public spending

An earlier DI Analysis shows that Danish companies are particularly optimistic about the future.

20 per cent of the companies in DI’s Business Panel expect a growth in revenue of more than 10 per cent in 2018, while over 50 per cent expect growth between 2 and 10 per cent.

Karsten Dybvad praises the parliamentary majority for ensuring that companies today have better opportunities to recruit internationally than they did back in 2007 – before the financial crisis – when they were facing a similar labour shortage.

“We are also benefitting from the fact that a responsible parliamentary majority took timely action with the retirement reform,” says DI’s CEO.

Meanwhile, he notes that there is a possibility that private consumption will increase more than predicted in DI’s forecast.

“If that happens, politicians will have to respond to the need for a tight financial policy that – as a minimum – does not increase public expenditure,” says CEO Karsten Dybvad, DI.

We are expecting the highest growth in private consumption in 12 years. That is good news, because it means that Danes can feel that it goes well for business – it goes well for them, too.

CEO KARSTEN DYBVAD, DI
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PUBLISHED: 2/28/2018 LAST MODIFIED: 2/28/2018