Proponents of raising the minimum wage often point to Scandinavian countries like Denmark as models for American labor policy. But the devil is in the details. Take this week’s New York Times profile of the comparatively high Danish minimum wage, for example. The authors ask, if the Danes can do it, why can’t the United States?
In the midst of a mostly-fawning piece on Danish labor policy, the authors unwittingly answer their own question: It would lead to higher prices and fewer job opportunities.
The piece points out that the associated higher labor costs mean that a Big Mac in Denmark costs 17 percent more than in the United States – $5.60 versus $4.80. Other analyses put the price discrepancy at around double this. For example, the equivalent of the “Dollar Menu” in Denmark is $1.41, and an extra value meal is nearly 40 percent more.
As a consequence of higher labor costs, Danish fast food restaurants are also far less profitable than their American counterparts–meaning that there are far fewer locations than in the United States. For example, there are 16 McDonald’s per million inhabitants in Denmark, compared to 45 per million in the United States. The corresponding lack of job opportunities for young and unskilled Danes is therefore significant.
So to answer the authors’ question about why can’t the United States follow Denmark’s example on the minimum wage another way: It could; it would just mean eliminating hundreds or thousands of job opportunities, and contending with a “Dollar Forty-One Menu.” It doesn’t quite have the same ring to it.
FAQs
Denmark. The average minimum monthly salary in Denmark is about US$3,300 (DKK 22,600) per month. CBAs establish minimum wages for about 84% of the Danish workforce, including most employees in the public sector and certain private industries, such as construction and hospitality.
Why does Denmark have no minimum wage? ›
Wages and working conditions are based on collectively-negotiated agreements, and the government rarely interferes. For example, there is no legal minimum wage in Denmark. Instead, the relatively high wages are set as part of the regular negotiations between the employers and labour unions.
How are wages set in Denmark? ›
There is no mandatory minimum pay in Denmark. The pay is typically governed by collective agreements for different types of work. For some types of work the pay will depend on the amount the worker must be paid, for example per hour. In other areas, the pay may have been agreed upon in other ways.
What is the lowest paying job in Denmark? ›
In 2022, food preparation assistants was the occupational group with the lowest average monthly salary in Denmark. That year, they earned just below 28,000 Danish kroner per month. Sales workers had the second lowest average salary at 30,000 kroner, followed by cleaners and helpers.
How much is a per hour job in Denmark? ›
The average minimum wage across different sectors ruled by the collective bargaining agreements is DKK 110 per hour. Collective bargaining agreements also cover some private sectors, such as the construction and hospitality industry. A collective bargaining agreement does not cover the majority of salaried employees.
What is the 11 hour rule in Denmark? ›
Break rights. Employees are entitled to an uninterrupted rest period of at least 11 hours for every 24 hours and at least one day rest per week.
Is Denmark more expensive than the US? ›
The median cost of living in the second- and third-most expensive states in the U.S. is $3,155 and $3,126, respectively. That's only slightly less than the $3,176 that's needed to get by in Denmark.
Why are Danish salaries so high? ›
In Denmark, employees enjoy some of the highest average wages in the world, reflecting both the country's high standard of living and its strong economy. The Danish labor market is characterized by a well-developed collective bargaining system, which ensures employees are compensated fairly for their work.
How much is rent in Denmark? ›
Costs of renting (per month)
A room for a single person in a shared flat costs between DKK 4,000 to DKK 6,000. Small studios or apartments (1-2 rooms + kitchen and bathroom) are highly in demand. They can be rented to a single person or a couple without children and cost between DKK 8,000 to DKK 10,000.
Why is unemployment so low in Denmark? ›
Employment growth has also accelerated lately. A policy of wage moderation and labour market reform carried out jointly by the social partners and the government is one of the main reasons for the Danish success. Also an effective macro-economic policy explains progress on the labour markets.
The amount of unemployment benefits is calculated based on the 12 months in which you had the highest income within the past 24 months. You can receive a maximum of: DKK 19,728 (2023) and DKK 20,359 (2024) per month as full-time insured. DKK 13,152 (2023) and DKK 13,573 (2024) per month as part-time insured.
What is a good salary in Denmark? ›
Monthly average earnings in Denmark 2010-2022
In Denmark, the average monthly earnings increased by nearly 9,300 Danish kroner from 2010 to 2022. By 2022, the average monthly earnings in the country were 46,200 Danish kroner. The highest average monthly earnings are found in the financial and insurance sector.
Is 50k a good salary in Denmark? ›
50.000 is a high salary and well above what most Danes would earn per month. On the other hand, it's not uncommon for people with serious IT programming skills to earn a lot of money.
Is 40000 a good salary in Denmark? ›
The average salary in Denmark is between DKK 20,000 and 40,000 per month, or approximately PLN 12,000 to 25,000. The minimum Danish salary for workers without language skills or relevant qualifications is around DKK 13,000 per month, or about PLN 10,000 gross per month.
Is 50000 a good salary in Denmark? ›
before taxes a good salary in Denmark (outside of Copenhagen)? Yes, it's a pretty good salary. It is enough to support a non-working partner if you live modestly.
