High taxes deter foreign workforce, study finds

Tight immigration rules are not as problematic as many Danish businesses have assumed

High tax rates and the Danish language are the greatest barriers when Danish companies are recruiting highly skilled foreign employees, while the tightened immigration rules and the negative tone in the debate about foreigners play a smaller role than previously thought, according to a survey of 244 Danish companies.

“As a knowledge-based company it is hard to attract and hold on to skilled foreign workers with the high tax rates in Denmark,” Lone Hass, the head of human relations for consultancy firm COWI, told Berlingske newspaper.

Almost 40 percent of the surveyed companies said the tax rates were the main hindrance when trying to attract qualified foreign workers, while some 15 percent pointed to the language as the main hurdle. Fewer than ten percent cited the immigration rules and four percent said the tone of the immigration debate was the main problem.

“There’s no doubt that the taxes are one of the main problems for the recruitment of foreign workforce and for our future growth,” said Steen Nielsen, the head of labour market policy at the Confederation of Danish Industry. “Also, in the debate there is a very reserved attitude towards foreigners, which could make it difficult to hold on to foreigners in Denmark.”

Since last autumn, prominent business people have voiced their concern about the immigration rules and the tone of the surrounding debate – the latest coming from the Consortium for Global Talent, a confederation of Maersk, Vestas and 15 of the biggest Danish and overseas companies in the country.

However, according to Tine Horwitz, the head of the Consortium, the situation is improving, mainly thanks to immigration minister Søren Pind’s recent relaxation of the controversial points system for family reunification. “Today we’re actually seeing slow improvements to the debate climate,” she said.



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