Friday, March 16, 2012

Scandinavia's Job Market

Let me first, for the layman reader, separate the concept of Job Market from Labor Market.
The Job Market can be thought of as a street market, where the supplier, in this case the employer, advertises a product, the job to a customer, the potential employee.
The Labor Market can be thought of as the reverse. Each job seeker is selling him or herself to employers.
The products and services in each market can be lumped together to give a picture of the capabilities and demands of an economy. Each Job Market is competing against other Job Markets to attract the most talented employees to its associated Labor Market. Each Labor Market is competing against other Labor Markets to attract jobs to its associated Job Market.

If you have noticed how the two are interdependent, then you should also see how immigration policy sets up a gate and control for employers and employees entering the market from outside. Denmark's job market is suffering a bit of internal strife at the moment because of actors that wish to restrict immigration and a mismatch between what the Job Market demands and what the Labor Market is offering. Dansk Folke Parti, or the Danish Peoples' Party, is the nationalist party represented in the Danish parliament at the moment. The party has set immigration reform, closing the borders to far more immigrants than before, as a priority for the ruling administration. However, such policy will hamper the Labor Markets ability to fulfill the Job Markets demand and put over qualified or misqualified people in positions that are better suited for people with either on the job training or trade educations.

Currently, the service economy in Denmark is supplied by a highly educated, mostly domestically trained, labor market. 27% have a university or equivalent education. But the Job Market demands employees with basic schooling to fulfill jobs such as garbage man, retirement orderly or janitor. Sourcing people to fill these jobs at the local Labor Market is difficult because few people with a full education are willing to work, what most feel, in a position beneath them. While people strive to the top of commerce and industry, there are too few to support the service economy's activities with basic services. Putting down the gate for immigration will prevent the Labor Market fulling market demands. Yet this also may reveal some of the short comings of the current education policy. Restricting supply will force both markets to adapt to do more with less and perhaps be in a better position for future changes in the global economy.

Sweden on the other hand has an open education policy that ensures the Swedish Job Market's supply of basic service jobs will always be in demand and the Labor Market's supply of new immigrants will be snapped up by the Job Market as second and third generation immigrant families advance themselves and require services. It is a rapid growth, which looks a bit like a bubble...

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