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At a time when extreme inflation is putting pressure on many Danes ‘wallets, nye figures document the highest wage increase in the Danish Employers’ Association over the past 13 years.
On Wednesday, the Danish Employers ‘ Association’s fresh business cycle statistics for the first quarter were published. The figures show that hourly wages in the DA area increased by 3.8 per cent in the first quarter of the year compared with the same quarter of the previous year.
The Danish Employers ‘Association is the main organisation for 11 employers’ associations in the private labour market. In total, more than 24,000 companies in industries such as industry, trade, transport, service and construction are members of DA.
In an e-mail, chief economist of the Danish Employers ‘ Association, Anders Borup Christensen, comments on the development:
“It is, among other things, the labour shortage in recent quarters and rising inflation that are now having an impact on wage developments,” writes Anders Borup.
It is especially members in the service and manufacturing sectors who are pulling up the percentages.
The development in manufacturing has thus increased by 0.8 percentage points and lands on an annual growth rate of 3.8 percent, while the development in service has increased by 0.6 percentage points and is at 3.7 percent
In addition, there has been an unusually high increase in the number of absence registrations in the first quarter of the year. According to the Danish Employers ‘ Association, This is due to sick leave with covid-19, which in the first months of the year forced a large number of infected employees home.
A dangerous cocktail
The chief economist of the Danish Employers ‘ Association expresses concern that the wage increase comes now that black clouds have begun to cast shadows over the economic reality of several of the country’s companies.
“The increased wage costs are on top of the fact that companies are already under pressure from higher raw material prices. This weakens companies ‘ ability to be competitive abroad,” writes Anders Borup Christensen.
By Anders Borup Christensen:
“Weakened competitiveness, high inflation, rising interest rates and great uncertainty about the outcome of the war in Ukraine is a toxic cocktail that risks slowing the progress of the Danish economy.«