According to a new analysis by SMVdanmark, a recent study has shown that there is significant untapped potential in the Danish labor market among immigrants from MENAPT countries (Middle East, North Africa, Pakistan and Turkey), despite the remarkable progress in employment rates in recent years.
General background on the labor market gap
The study indicates that Denmark has made significant progress in integrating non-Western immigrants into the labor market, but an employment gap persists between Danish citizens and non-Western immigrants. The study explains that this gap stems from the heterogeneous nature of this group, particularly in terms of their countries of origin, with immigrants from MENAPT countries standing out as having a weaker connection to the labor market.
Figures reveal the size of the gap
The data shows that the number of working-age migrants (16-66 years) from MENAPT countries was 158,800 in 2025. Of these, only 44.61 TP3T were employed as wage earners, compared to 65.51 TP3T of Danish origin. This represents an employment gap of 20.9 percentage points.
The study indicates that closing this gap would have added approximately 33,100 full-time employees in 2025, representing significant untapped potential in the economy.
Potential economic impact according to the Ministry of Finance
واستندت الدراسة إلى تقرير صادر عن وزارة المالية بعنوان “مساهمة المهاجرين في المالية العامة لعام 2019″، حيث خلص التقرير إلى أن انتقال مهاجر واحد من دول MENAPT من البطالة إلى العمل يعزز المالية العامة بنحو 258 ألف كرونة دانماركية (بأسعار 2019).
According to estimates, closing the employment gap completely would have yielded an economic return of 13.3 billion kroner at 2019 prices. When calculated at 2025 prices and wages, the estimate drops to around 11.8 billion Danish kroner.
The role of non-Western immigrants in employment growth
The study confirms that non-Western immigrants have played a key role in increasing employment rates in Denmark in recent years, contributing approximately 58% of the increase in the employment rate over the past three years.
In 2025, the employment rate among all non-Western immigrants was 53.0%, compared to 65.5% among Danes.
A larger gap within the immigrant category itself.
The study reveals a clear disparity within the non-Western immigrant category, with the employment rate among immigrants from MENAPT countries reaching only 44.6%, compared to 58.3% among immigrants from other non-Western countries – a difference of 13.7 percentage points.
The study confirms that this delay is the main factor that reduces the overall rate of employment of non-Western immigrants.
Significant improvement since 2015
The data indicates that the employment rate among Danes has increased by 3.3 percentage points since 2015, while it has increased by 16.2 points for migrants from MENAPT countries and 14.6 points for other non-Western migrants.
The study explains that this large growth is partly due to the lower starting point in 2015.
Faster integration of new immigrants
The study shows an improvement in the speed of integration of new immigrants into the labor market, as the percentage of employed MENAPT immigrants during the first year of residence increased from 33.2% in 2019 to 42.6% in 2024, an increase of 9.2 percentage points.
A persistent gap despite improvement
Despite the overall improvement, the study confirms the persistence of the employment gap. The gap with Danes has narrowed by 12.9 percentage points since 2015, but still stands at 20.9 points. The gap with Western immigrants has also narrowed by 7 points, and with other non-Western immigrants by only 1.6 points.
The study indicates that MENAPT immigrants were more severely affected by the global financial crisis than Danes and Western immigrants, and that the recovery was substantial but incomplete.
An economic explanation for the gap: conservative wages
كما تؤكد الدراسة أن تحقيق الإمكانات الكاملة يتطلب النظر في ما يسمى “الأجر التحفظي”، وهو الحد الأدنى للأجر الذي يقبل به الفرد للعمل.
She explains that many MENAPT immigrants receive benefits that exceed what they could earn from work, especially in cases of early retirement, making staying out of the labor market a more attractive option.
Policy proposals to address the problem
The study suggests setting a ceiling for early retirement benefits so that they do not exceed potential income from work, in addition to assessing the ability to work according to a gradual scale instead of the binary classification (able or unable).
It also confirms that many individuals outside the labor market have the potential to integrate later, which calls for more flexible and encouraging employment policies.
Summary of the analysis
The study concludes that the 20.9 percentage point employment gap represents a significant economic opportunity, as it could add more than 33,000 full-time jobs and generate up to 11.8 billion kroner for the Danish economy in 2025.
It also indicates that the largest portion of this potential is concentrated among individuals outside the labor force, such as early retirees, students, and social assistance recipients, which requires structural reforms to enhance their participation in the labor market.
Study Methodology
The study calculated the employment gap by comparing annual employment rates for individuals aged 16 to 66, measured in full-time work units. Data from the first three quarters of 2025 were used.
The data for the period between 2019 and 2022 were also adjusted due to the increase in the retirement age from 65 to 67. Potential was calculated by multiplying the employment gap by the number of MENAPT migrants of working age.
As for the financial impact, it was based on Ministry of Finance data for 2019, adjusted for wage growth up to 2025, where the study assumed that 91% of the potential comes from reducing the number of people outside the labor force, and 9% from reducing unemployment.
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