Danemark – A solid safety net

While the gap between the wealthy and everyone else is widening in much of the industrialized world, a large chunk of Danes remain firmly middle class. Forty-two percent of the working population of 4.6 million have annual disposable incomes between 200,000 and 400,000 kroner $36,700-$73,300. Just 2.6 percent earn more than 500,000 kroner a year $91,383. 

According to the OECD, the top 20 percent of Danes earn on average four times as much as the bottom 20 percent. In the United States, by contrast, the top 20 percent earn about eight times as much as the bottom 20 percent.

The idea of a generous government-provided cushion for ordinary people is deeply rooted in a nation with few outward signs of a pampered elite. Members of the royal family often bike to drop off their children at a public daycare center. Last winter, Prime Minister Helle Thorning-Schmidt was seen shoveling snow outside her home in Copenhagen.

With a solid safety net in place, the government has persuaded unions to accept a flexible labor market. Under a model known as “Flexicurity,” companies can quickly lay off staffers during downturns. Laid-off workers, in turn, receive training and guidance in pursuing new careers.

Chosen excerpts by Job Market Monitor. Read the whole story at What wealth gap? Danish welfare narrows disparity – The Washington Post.