1. The need for adaptive labour market systems Claus Andersen, Head of Division, The Danish Ministry of Employment

2. Brief presentation of myself
Head of Division, The Danish Ministry of Employment
Head of the ministry’s unit of analysis
Deeply involved in the day-to-day policy making
Also responsible for long termed analyses, e.g. effect analysis
Head of a new behavioral insights unit (collaboration with the University of Copenhagen)
Chairman for working group reforming unemployment benefit System for self-employed and new forms of work

3. Main topic of presentation
My key argument today is: the labour markets of today and tomorrow demand highly adaptive systems
I will support this argument by presenting:
the key factors and conditions driving the need for change
examples of the latest and future policy measures in Denmark

4. Why is there a demand for highly adaptive labour market systems?
We live in a changing world – and the speed of change is/could be increasing
Technology will – as previously - change the future of how we work (robots, artificial intelligence)
But some sectors can be disrupted by new technology that travels fast in a globalized world
The spread of new appliances, US
Number of new industry robots in Denmark
Source: Nicholas Felton “Consumption spreads faster today”, 2014
Source: DIRA, Danish Robot Network

5. The Danish example: what is flexicurity?
Flexible labour market
Generous welfare benefits
Active Labour Market Policy

6. Key aspect of ‘flexicurity’: Easy to fire (and hire)
Protection of permanent workers against individual dismissals: difficulty of dismissal
Source: OECD Employment Protection Database, 2013 update.

7. Key aspect of ‘flexicurity’ II: High replacement rates in the bottom and great emphasis on active labour market policies
Netreplacement rates for unemployed
Public spending on ALMP as share of GDP
Low Avg. High
Wage level
Note: Spendings on ”Sheltered and supported employment” is not included
Source: OECD

8. The Danish example: How has ‘flexicurity’ performed so far – what do the numbers show?
High employment rate above the OECD-average…
Source: OECD
Source: Statistics Denmark

9. The Danish example: How has ‘flexicurity’ performed so far – what do the numbers show II?
…a high job mobility and a low inequality
Source: OECD

10. Future challenge to the flexicurity model: More people are in risk of not fitting in to the model
Sources of income the past 12 months
Yearly growth in less permanent employments
Source: Survey, Statistics Denmark and the Danish Ministry of Employment
Source: Statistics Denmark

11. Case: Unemployment system for the future labor market
Current system
Two seperate unemployment benefit systems
Differences in regulation
Differences entitlement to unemployment benefits
Based on individual assessment
Manual processing
New system
System harmonisation
One system handling all forms of employment
Creates a safety net for everyone
Consistency between the tax system and the unemployment benefit system
Full digital and based on registers

12. Unemployment system for the future labor market - fully digital
Self-employed person
Annually €
TAX ∑
Income data
Benefit
Unemployment
insurance funds
Monthly €
Unemployed
Employee

13. Latest policy measures in Denmark adress the need for highly adaptive labour market systems
The Danish government will very soon establish a “Disruption Council”
Avoiding the “usual suspects” , the council will consist of experts, business, social partners, youth representatives
It will analyze and discuss:
How Denmark utilizes the possibilities of new technology and globalization
And at the same how to maintain and develop a labour market without social dumping
The Danish government will in June begin a new round of tripartite negations with focus on the Danish system of adult education and vocational training
Main ambition is to creating a responsive system that is quickly receptive to labour markets demand for competencies

14. Thank you for the time – any questions?
Contact: