12,500 new jobs to soften blow of unemployment cuts

Pledge to create new jobs comes as thousands face losing their unemployment benefits at the end of the year

Prime minister Helle Thorning-Schmidt’s (Socialdemokraterne) government has hammered out a deal that will see a number of public and private sector groups pledge to create 12,500 jobs for those in danger of losing unemployment benefits when new regulations kick in at the start of 2013.

The changes to the dagpenge system that were passed by the former government have been at the top of the agenda since parliament opened for business earlier this month. According to the Employment Ministry, up to 16,000 people will lose their benefits in 2013. The former government halved the length of time that the unemployed can claim benefits to two years, and doubled the length of time they have to be in full-time employment before being entitled to the benefit to a year.

In addition, the deal guarantees that private sector workplaces that hire two employees about to lose their benefits will receive an 25,000 kroner after one year.

Calling this an “extraordinary situation with extraordinary solution”, Thorning-Schmidt told the press this morning that the jobs are targeted at people who are in danger of exhausting their benefits on the first of next year.

She had high praise for those employers that were willing to help create the 12,500 jobs.

“They are taking on a very large social responsibility,” she said. “We want to acknowledge their efforts and that is why we will give them a cash bonus for the jobs they provide.”

The agreement is slated to start on November 1 and continue into next year.

Bente Sorgenfrey, head of the 450,000-member strong union FTF, expressed satisfaction with the deal.

“It is a very good initiative,” she told Jyllands-Posten newspaper. “Employers need to focus on those workers at the back of the queue, and this agreement will help.”

Stine Brix, spokesperson for the far left party Enhedslisten, called the plan “positive, but not enough”.

Brix told TV2 News that too many people were still at risk of falling out of the system and into poverty.

“We have an emergency situation that might develop into a social catastrophe,” she said. “We still need more creative ideas on the field,” she said.

Thorning-Schmidt said that additional measures to help the unemployed could still be on the way.

“We will continually monitor the situation, but this is a big step,” she said.

Full details of the agreement have not yet been published. The Copenhagen Post will provide updates as they become available.

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