The Danish Confederation of Trade Unions (LO) is a passionate supporter of EU enlargement. Europe’s historical obligation and the long-term economic and geopolitical advantages of enlargement clearly compensate for the short-term problems it may entail for Danish labour markets. Until now, these problems have been of a relatively small nature in Denmark, where only around 4,000 work permits have been issued. In the long run, we believe that the competitive aspect from abroad is welcome – that includes the infamous Polish plumber. We insist however, that he is paid according to the collective agreements that have been worked out between Danish employees and Danish employers and that he obtains the same rights as every other member of the Danish labour market. Fair competition is all about competencies, skilled trade and innovation – not about under-priced salaries and undermining working conditions.
      The European model and its regulated labour markets is not a relic from the past – on the contrary – it is an asset for Europe in the global economy which presumes constant and rapid change.

Ironically, most people defending the European social model often end up recommending the worst conceivable solution: maintaining the status quo.
      The fundamental misconception is believing that the protection of the European model can be coped with by resisting change. Too often, well-intentioned individuals end up being advocates for plotting a new European Maginot Line consisting of a combination of protectionist trade policies and outdated job-protection programmes.
      Instead of defending the status quo, those of us who wish to experience the fl ourishing of the European social model should greet change. Change is consistent with progress and security for the employees of Western Europe – actually, it is a prerequisite for our security in the long run. Instead of clinging to jobs that will, eventually, disappear (if not to Eastern Europe, then to China or India in the long run) we need to create new jobs in Western Europe.
      Some people believe that an automatic trade-off between the wish for security and the need for change exists. This is not, necessarily, the case.
      The defence of status quo is a bad strategy – but it is even worse to resign due to a belief that a total deregulation of the European labour markets is inevit able. What we need are well-considered regulations that promote change and competitiveness and, at the same time, safeguard the security of the individual employee.
      In this connection, I allow myself to accentuate the Danish working model as a good example – even though this might seem a bit presumptuous. The Danish economy has thrived since the 90’s – we have experi enced low unemployment, low infl ation and a steady growth. The unemployment rate has reached a level of 5.2 per cent and, according to a survey performed by The Economist Intelligence Unit last year, Denmark was the most competitive country despite our relatively high tax rates.

Scarcely 30 per cent of the Danish work force in the private sector change job each year – this is a higher fi gure than in both Great Britain and the USA. Still, the Danes’ feeling of employment security is only surpassed by Norway in the OECD – we are far ahead of France, Spain and other countries that have much stricter regulations for the companies’ possibility of laying off employees.
      This is not to suggest that the structure of the Danish labour market is applicable to whichever other European country. Even so, it seems that the other countries may learn a thing or two, especially considering that we experience a flow of delegations and work groups travelling to Denmark to draw lessons from the Danish model.
      My point is that a combination of a high level of social security for the individual employee and a fl exible labour market is far from being impossible. It is defi nitely not a matter of either/or… In Denmark’s case, it is a matter of two complementary – even symbiotic factors. A deregulation of the Danish labour market would be catastrophic.
      My contention is that an active welfare state with a heavily regulated labour market can be a forceful catalyst to change and, thereby, an important asset in connection with dealing with the challenges of globalisation. This model is able to enhance the upgrading of skills that are necessary to succeed in the global economy. It is able to promote social cohesion. Further, it can encourage the degree of security that results in employees being able to embrace change as opposed to being forced out of one’s home due to a hopeless battle against globalisation.
      We need well-considered labour market reforms instead of deregulation.

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