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Nordic region balancing the need for labour and risk of dumping

| Text: Björn Lindahl

It's a balance all the Nordic countries need to strike when they want to attract highly competent labour: how do employers gain easier access to necessary manpower, and how should countries protect their labour markets against social dumping?

"There can be a dark side to the hunt for competence. Migrants can end up being valued and gaining rights according to which qualifications they possess," reads the report  "Recruitment of competent labour from third-countries to the Nordic Region".  

People with higher education moving from one country to another can benefit both countries when there is a surplus of people educated in a certain sector in the original country and a lack of such competence in the receiving country.

But you might end up with the opposite. Highly competent labour leaves one country where it is needed and arrives in a country to force out the domestic talent. 

"It all needs to be looked at in a social perspective beyond national interests," the report says. 

Other countries more attractive

It remains challenging and difficult to recruit highly competent labour to Nordic businesses from countries outside the EU and EEA. Viewed from China, India or Russia, other countries might seem more attractive: the USA, Canada, Great Britain or Australia. 

After the 2004 EU enlargement a far larger number of workers from the new member states than predicted moved to Western Europe. Norway proved particularly attractive. 

But the new EU countries also became victims in the end because of labour shortages as a result of demographic developments and the fact that so many already had emigrated. As a result, Nordic countries are already looking further afield; to India, China and other Asian countries.

Different structures

The various countries have, however, different structures and different needs. Sweden, with its many large businesses, has gone furthest in allowing the private sector to make sure the labour which is recruited from abroad really is needed and that the workers have the right skills. In Denmark, a country with many medium size and smaller companies, the state is more active. What is somewhat surprising perhaps, in light of the Danish immigration debate in recent years, is that Denmark is the only Nordic country allowing people to move there and start looking for jobs only after they've arrived - a so-called Green Card. The other four countries demand to see a job offer before anyone is granted permission to stay and work.

In Finland the debate has centred on the impact immigration has on the domestic workforce. Norway is positive to labour immigration, but has so far only succeeded in attracting labour from the EU. Iceland is alone in seeing no need for immigration for many years to come, because of the economic crisis. 

What's the strategy? 

The report goes further than exploring the similarities and differences between the Nordic countries' labour immigration policies. It tries to describe the different countries' strategies too. 

"The main aim is not to get as many foreign workers to Denmark as possible, but to get the number we need to meet the demands of the labour market at any given time," is one such strategy. 

This is an ambitious strategy which is dependent on good information. Denmark as been monitoring the supply of labour, but only after the introduction in January 2010 of the Labour Market Authority's so-called key number system has it been possible to see how many foreign workers choose to stay in Denmark. It is still not possible to see what special skills the foreign workers have. 

The definition of highly competent labour varies from country to country, and makes it even more difficult to compare them. Also, many of the measures are so new that it is still too early to measure any effect. 

The Nordic region or the EU?

The report says there should be a good basis for extended Nordic cooperation on the recruitment of highly competent labour, because the numbers needed aren't too big. There is no real competition for labour between the countries. There is, however, different opinions among the Nordic countries on whether they want to market themselves as part of Europe rather than the Nordic region in order to attract labour from third-countries.


Offers four types of work permits:

The Pay Limit Scheme If you have a job offer from a Danish employer that pays more than DKK 375,000 you are eligible for a work and residence permit.

– The Positive List If you have skills in an occupation where there is a lack of qualified workers, you can obtain a work and residence permit in very little time.

The Business Scheme Allows businesses with foreign activities to import labour from daughter companies.

Green Card If you can score enough points based upon criteria such as age, education, language skills and work experience, you can obtain a two to three year residence permit.


Changed its Aliens Act in 2004. Immigrants from third-countries must have a job offer in order to get a residence permit. They will also be considered against the labour needs of the relevant industry. Immigration has so far been modest. Special rules apply to certain groups like students and researchers. The government proposed to simplify the regulations in December 2009. 


Experienced a large increase in foreign labour during the boom years, peaking in summer 2007. The finance crisis has hit Iceland very hard and unemployment has risen sharply. The country does not see the need to recruit foreign labour in the foreseeable future. 


Introduced a new Aliens Act in 2008. Immigrants from third-countries must have a job offer in order to get a residence permit. Those with documented annual income of at least NOK 500,000 are allowed general work and residence permits with no weighing of the labour needs in the industry. There is also a special quota of 5,000 specialists who don't meet the salary demand.


Changed its Aliens Act on 15 December 2008. Sweden has done most out of the Nordic countries to simplify the work and residence permit situation and leaves a lot of the responsibility with employers. So far there has been no marketing to attract foreign labour, but labour market councillors work in Beijing and Brussels. With companies in charge of their own foreign recruitment, there is little need for state-sponsored recruitment drives.


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