Sociologists shed light on the digital labour market in Denmark

The digitalisation of the labour market – digital automation and online platforms in Denmark

A growing number of Danes are earning money through digital labour platforms like Happy Helper – that provide cleaning services for private costumers – or digital capital platforms like Airbnb. But how do online platforms recruit workers, and how many people find work via the digital labour market? These are important questions, which among other things are essential to ensure that correct income tax is paid.

In 2017 the sociologists Anna Ilsøe and Louise Weber Madsen from the Employment Relations Research Centre (FAOS) at University of Copenhagen completed a comprehensive report about the digital labour market in Denmark. Their research generated new information that has been utilized by the Danish Tax Assessment Council, the Ministry of Employment and others.

Methodology

The analysis was based on survey data from a representative sample of 18,000 Danes. The data were collected by Statistics Denmark from January to March 2017.

There is a considerable growth potential in labour and capital platforms. This gives rise to a number of new questions: how do platform companies fit into the Danish labour-market model? How do we ensure proper conditions for people who find work via these platforms? To work on new questions like these, it is crucial that we have a good foundation of knowledge and research.

Outcomes

The analysis revealed that more than 100,000 Danes earn money via digital labour or capital platforms.

Just over 42,000 have earned money via a labour platform, and approximately 65,000 via a capital platform.

Based on the sociologists’ figures, the Danish Customs and Tax Administration commissioned the Tax Assessment Council to conduct a trial in which five labour platforms were subject to a duty of disclosure regarding income earned by their users. The trial was evaluated in 2019. The evaluation revealed that 95 percent of platform workers did not report their income to the tax authorities.

The Ministry of Employment has also used the sociologists’ definitions of what constitutes a labour platform (a platform for generating income from work, e.g. Happy Helper) and a capital platform (a platform for generating income from the rental of houses or equipment, e.g. Airbnb).

Our figures for Danes who offer work through digital platforms were slightly lower than those otherwise cited in public debates. This is because we spoke to a broader range of people, which makes our data more representative.

Further research

Anna Ilsøe is continuing her work on the digital labour market via the research projects The Future of Work (funded by The Nordic Council of Ministers), Atypical work in a health and safety perspective (funded by The Velliv Association) and The Digital Economy at Work (funded by The Velux Foundations).

The digital labour market consists of:

• Labour platforms (apps or websites facilitating work), e.g:
  Happy Helper (cleaning in private homes)
  Handyhand and Jobbi.dk (private services like painting, gardening or cleaning)
  Worksome (platform for freelancers and consultants, e.g. in knowledge-intensive and creative sectors).
• Capital platforms (apps or websites for rental of houses/rooms, vehicles, equipment, etc.), e.g:
  Airbnb (private homes)
  GoMore (private cars and car shares)

Research Report: Digitalisation of the labour market

• Analysis based on responses from a representative sample of 18,000 Danes.
• The responses were collected by Statistics Denmark from January to March 2017.
• The researchers: Anna Ilsøe and Louise Weber Madsen, FAOS, Department of Sociology.
• Based on the figures, the Danish Customs and Tax Administration commissioned the Tax Assessment Council to conduct a trial in which five work platforms were subject to a duty of disclosure regarding income earned by their users. The trial was evaluated in 2019. 
• The evaluation revealed that 95 percent of platform workers did not report their income to the tax authorities.

Read the research note here.