Immigration and integration policy and labour market attainment among Scandinavian immigrants

Comparing immigrant labour market integration, the OECD ranked the Scandinavian countries Denmark, Norway and Sweden at the bottom. Integration depends on immigration and integration policy, and the countries’ policies have traditionally here been very similar. However, in the early 2000s Denmark increasingly deviated, introducing stricter immigration and harsher integration policies. Using Norway and Sweden as benchmarks, we assess the wider impact of this comprehensive policy reversal tracking the evolution of national employment and earnings gaps between 1993 and 2006. We use large data sets with individual level register information allowing us to account for immigrant labour force composition and to examine sub-groups of immigrants. The results indicate that the Danish reforms increased employment among groups of non-Western immigrants while simultaneously decreasing relative earnings. However, employment trends in Norway and Sweden were almost as positive without similar earnings penalties, questioning the aptness of the Danish reforms.