Disability employment initiatives: review of recent evidence from Denmark and Sweden

Summary of key findings

This review has been carried out in response to the aims of the Fair Work Action Plan ^[[1]] and Fair Work Convention’s Response ^[2] to: ‘Measuring Scotland’s Performance as a Leading Fair Work Nation’ undertaken by Alma Economics ^{[3 ]}which recommended:

“The Scottish Government should focus on drawing lessons from countries that are doing well on fair work indicators and Active Labour Market Policies. Particular focus should be given to Denmark on the disability employment gap.”

The disability employment gap is the percentage point difference between employment rates of non-disabled and disabled adults ^[3]. The disability employment gap in Scotland in 2023 was 30.2 percentage points ^[4].

After an initial examination of available evidence it was agreed to focus this rapid review on evidence surrounding the promotion of disability employment in Active Labour Market Policies (ALMPs) in Denmark and Sweden.

This rapid review took place in summer 2024, and a near-final draft including key findings was shared with the Fair Work Oversight Group for their awareness in June 2025.

Key Findings

Denmark

• Disability employment statistics: the employment rate for disabled people in 2020 was 59.5% ^{[5 ]}and, the disability employment gap was 20.4 percentage points in 2023 ^[6].
• Characteristics of the employability support system: Highly decentralised, national public employment service supports policy design and implementation, and municipalities implement policies with autonomy. A flexicurity model (aiming to achieve flexible labour market with high income security and strong support from ALMPs) underpins the Danish approach.
• Key findings on the effectiveness of ALMPs: The flexi-job scheme, designed to facilitate stable employment for disabled people through wage subsidies has been particularly successful in increasing participation, especially those with prior work experience. The overall effectiveness of ALMPs is mixed with age, severity of disability, educational disparities, and lack of strategic focus on disabled people affecting outcomes. Data infrastructure enables robust impact evaluations but, employers’ attitudes are a barrier.

Sweden

• Disability employment statistics: the employment rate for disabled people in 2020 was 53.9% ^[7] and, the disability employment gap was 23.2 percentage points in 2023 ^[6].
• Characteristics of the employability support system: Key policy aspiration is to promote social inclusion and full participation of disabled people in society. There is a cultural expectation that everyone participates in work, with programmes combining learning with work skills development.
• Key findings on the effectiveness of ALMPs: Sweden’s flagship policy of wage subsidies to increase disabled people’s employment produce mixed results with the risk of a ‘lock-in’ effect, and there are significant and widening income gaps for disabled workers, especially following job loss. Linked administrative data and data exchanges support research and evaluation; and, several approaches work in supporting employers.

Success factors and Challenges

• Success factors in implementing ALMPs targeting disability employment identified in both Denmark and Sweden included: systematic data exchange and built-in evaluation mechanisms; wage subsidy programmes which are effective in the short to medium term; and, employer engagement and support. For Denmark, formal involvement from organisations representing employers and workers, and local delegation of ALMPs presents another strength.
• Challenges associated with ALMPs implementation across Denmark and Sweden included: long term effectiveness of wage subsidies and the risk of a ‘lock-in’ effect; employer reluctance and perceptions regarding hiring disabled people; and, staying in employment once starting a job.