Adapting and upskilling is the key to continued growth and a skilled workforce.
As we move around Denmark, construction cranes are popping up in many places. This is really positive, and in fact, we are now seeing industries and professions where there is a definite shortage of labor. In particular, we see that companies are looking for well-educated, skilled employees.
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Holiday homes, hotels, bridges, roads, and work on the world's longest immersed tunnel suddenly brings Lolland to a hectic center of development. New residential areas are being laid out and the big cities are building higher and higher. Schools, institutions and other public buildings are getting a much-needed facelift. All with a focus on green transition and efficient manufacturing, benefiting both Denmark's economy and employment in several industries.
One year into the corona pandemic, where we can safely expect a larger bill for the many closed shop doors, canceled production orders and lack of exports, it seems that many companies are still in need of workers. The challenge is for businesses and companies to avoid running into a shortage of skilled labor in the form of skilled workers. This paints a picture of a labor market that will place great demands on management, education and political initiatives.
Foreign workers in Denmark alleviate bottlenecks in the labor market.
At the beginning of 2019, Dansk Metal concluded in a study that there have never been so many foreigners employed in Denmark. In total, 215,000 foreigners earned their salary in Denmark. This is just over 15,000 more than the previous year. At the same time, according to Statistics Denmark, more than 100,000 Danes were registered as unemployed. In November 2020, when Covid-19 kept us at home, at a safe distance and properly sanitized, the unemployment figure was 103,700.
Read also: Bottlenecks in the labor market place demands on your company's ability to attract skilled labor.
FAQ
There is a pronounced labor shortage in several industries. For a number of years, there has been a shortage of skilled workers in the manufacturing industry, which has meant that not only low-wage jobs have been performed by foreign workers. The construction and iron and metal industries have also attracted a significant number of employees to the country for several years. Especially from Eastern Europe.
For a number of years, the continued shortage of qualified Danish labor in the construction and metal industries has been solved by importing labor from abroad. During the same period, Eastern Europe has seen increased unemployment, a social safety net that does not offer the same help to the unemployed as we know it in Denmark. As well as a generally lower standard of living, which has made it attractive for foreign workers to come to Denmark and other Western industrialized countries.
Denmark has a significant group of citizens who are either outside the labor market (unemployed) or employed as unskilled workers. Technological development is leading to increased automation and thus a reduced need for unskilled labor. On the other hand, the need for skilled staffing in crafts and automation etc. increases.
Older employees leave the workforce earlier.
The Welfare Agreement allows employees to retire from the labor market after 42 years of hard and good work. This means that skilled and experienced skilled workers are leaving the labor market "early", leaving an even greater need to think about work planning, staffing and production processes in a new and more appropriate way. In the second quarter of 2020 alone, 39,000 experienced employees left the labor market. And the Confederation of Danish Industry expects another 22,000 "early leavers" to follow in 2022. Replacements must be found for hands, skills and experience.
It has long been apparent that the composition of the population is changing. The group of older people is getting relatively larger, and as a consequence, the younger part of the workforce will have to support the ever-growing group of older people who are leaving the labor market for a well-deserved retirement. As is already the case in several craft trades, other industries and professions will also experience a shortage of skilled labor. There is still a lack of young people who want to start a crafts education and end up as sought-after skilled workers. And even fewer are able to complete the training if they have jumped on board.
Fewer young people are choosing vocational education.
In 2015, the Danish Parliament and the social partners decided to make it more attractive to become a craftsman. There are exciting challenges, good employment opportunities, good salaries and good opportunities to put your head and hands to practical use. A goal was announced that 25% of future youth cohorts should be "motivated" to pursue a career in craftsmanship in Danish companies. In 2020, that goal was still a long way off. Only 20% have attempted it so far. And in many places, vocational schools are struggling to retain young people.
When looking for explanations as to why young people don't apply for crafts education and professions, it is often pointed to the fact that:
- Young people no longer get to know the industry through, for example, jobs as youth workers.
- The student counselors in primary and secondary schools do not have the necessary insight into what job and career opportunities the industry and the individual profession can offer.
- Schools are too biased towards more academically based education.
- Young parents have academic ambitions for their children.
In any case, the sum of these explanations means that young people still don't value the opportunities that a craft career and education offer.
Labor shortages - especially skilled workers.
In recent years, much has been said and written about optimization, green transition, construction management and recruitment issues. But, from our chair, very little about the culture on construction sites. On the tone, which can be "tough but cordial, on the physical challenges - wet pants and cold fingers. And on the demands of production, work pace and efficiency driven by piecework and demands for timeliness, along with a management style that can easily clash with the curling parents' shaping of young people.
If we are to succeed in attracting more young people into vocational training and at the same time retain more people from the other end of the age scale in the labor market, there is a significant leadership task ahead of the craft industry. In October 2019, "Solidaritet.dk" wrote that for many seniors, working life is becoming less and less attractive because work performance and professionalism are no longer recognized from a craftsmanship point of view. Employees' ability to apply their practical skills is limited by rules, standards and procedures. At the same time, seniors express that the professional insight that previously created quality in management is not present to the same extent because the new manager "comes with a spreadsheet under his arm instead of professional insight".
When it is difficult to retain seniors and it has not yet become sufficiently interesting for young people to move away from high school to more practically oriented education, it must, all things being equal, have consequences for employment, production and growth in society. Quite simply, it will be difficult to ensure a balance between supply and demand for labor, and some industries will experience labor shortages.
Read also: Try and hire - Try out a new employee before you hire permanently
Training, adapting and upskilling.
There's a lot of work to be done to make ends meet.
- Young people need to be tempted to jump on board a vocational training program.
- Older people should be encouraged to stay in the labor market longer, perhaps by having the option of a gradual exit.
- The middle group must be given better opportunities to change course throughout their lives and retrain or upskill through adult education. In this way, a higher level of skills can be ensured while also reducing the number of unskilled workers.
The future does not offer the same opportunities for the unskilled, and therefore it is an economic prerequisite for future growth and prosperity that the "residual group" is also activated and educated.
If this is to succeed, it will require breaking with tradition, changing management principles in relation to both people and procedures. Probably also a different way of thinking about employment and attachment to the labor market and to the individual company. Perhaps the path may involve opportunities for reduced working hours, flexible working hours, shorter employment contracts and a greater acceptance of people's differences. Both in terms of ability, background and professional interests.
The flexible and adaptable labor market of the future.
At Procur, we believe in the need for increased flexibility and thus increased demand for skilled temporary labor. As demands for efficiency increase, so does the need for companies to adapt and change. There is a need to optimize resource use, energy consumption and environmental impact. But also in relation to operating and production costs, where one way to do this is to reduce permanent staffing and hire temporary workers when the need for skilled employees arises.
Is your business one of those that needs to attract extra resources. Or need a more flexible workforce, a temp agency can be a great solution. A good temp agency knows the market your business competes in and the professional requirements of your industry. And they have the necessary insight into working time regulations, collective agreements, local agreements and pay conditions to ensure that your temps are hired on the right contract and receive the right pay and benefits for their work.
But a good temp agency isn't just a supplier of labor. A good temp agency can also be a collaborative partner that can share insights and experience to help your business get the most value and growth out of the relationship.
Want to know more about the benefits you can get?
Contact us on +45 3215 1010
