Economic Survey, August 2019


The Danish economy has a strong foundation, and the conditions are good for the economic upswing to continue in 2019 and 2020. The economy is expected to grow by 1.7 per cent in 2019 and 1.6 per cent in 2020, which is a slight dampening compared to the past four years, where GDP has expanded by an average of 2 per cent per year.

In particular, a strong labour market underpins the upswing. When employment increases and fewer receive benefits, it generates higher income, and provides basis for increased consumption. In addition, Danish exports have so far shown resilience despite signs of weakness in the international economy.

Since 2013 the momentum in the labour market has been strong. Employment has risen to a record high, while unemployment has dropped to around 100,000 persons. The positive labour market trends are expected to continue towards 2020, but at a gradually slower pace, among other things because it is becoming harder for companies to recruit new workers.

The economic forecast for Denmark economy is currently subject to a particularly high level of uncertainty. The foundation is strong, but risks have increased during 2019 and are mainly tilted to the downside. Two conditions in particular can reduce economic growth and job creation. The first is a no-deal Brexit. The second is the ongoing USChina trade conflict, which may escalate further. Both can have a significant negative impact during the forecast period, especially if it affects global sentiment.