New analysis shows that private companies in Denmark employ significantly more administrative staff than public institutions—by at least 39%, and up to 70%, depending on the methodology used.
Private Sector Employs More Administrative Staff
A new study by the Danish economic policy think tank, Arbejderbevægelsens Erhvervsråd (AE), reveals a surprising discrepancy between the private and public sectors in Denmark when it comes to administrative staffing levels. Contrary to the popular belief that Denmark’s public sector is weighed down by excessive bureaucracy, the data shows that private businesses actually have a considerably higher share of administrative employees. Companies in Denmark may have more paperwork than people think.
According to the report, administrative personnel make up between 25% and 31% of the total workforce in private sector companies. In contrast, the figure stands at around 18% in the public sector. This means that private enterprises have between 39% and 70% more administrative staff than their public counterparts. Turns out, the public sector isn’t the biggest when it comes to admin staff.
Stable Levels of Public Administration
The analysis reveals that the number of administrative employees in the public sector has remained fairly consistent since 2016. Although there has been an increase in administrative roles at the national level—particularly within tax authorities, environmental and energy departments, and defense initiatives—this growth has been practically offset by reductions in administration in municipalities and regional governments.
Overall, public sector administration has not shown significant growth over the past decade. This challenges the prevailing narrative frequently found in political and media discourse, which often criticizes “excessive bureaucracy” within government institutions, unline many companies in Denmark that have been expanding.
Methodology and Data Sources
The conclusions are based on data from several reputable sources, including Statistics Denmark, the Confederation of Danish Employers (Dansk Arbejdsgiverforening), and the Ministry of Finance. The use of multiple data sets strengthens the credibility of the comparisons and shows consistency in the disproportion between private and public sector administrative employment.
From 2010 to 2023, the pattern has remained stable: the private sector consistently demands significantly more administrative labor.
Comparison Within Shared Sectors
To account for the argument that private and public sectors perform different types of work, the analysis also zooms in on sectors where both public and private providers operate side by side—such as welfare services including healthcare, eldercare, and childcare. In these sectors, too, administrative staff make up at least the same, if not a larger, portion of the workforce in private institutions.
This means the higher administrative burden in the private sector cannot be attributed solely to variations in business types or legal requirements.
Denmark’s Public Sector Efficiency
International comparisons only further reinforce these findings. The World Bank ranks Denmark’s public sector as the second most efficient among 40 countries analyzed. This suggests that public service administration in Denmark is not only leaner than in the private sector domestically but also outperforms many countries globally in terms of effectiveness.
So while public sector reforms have often targeted reducing “cold hands”—a local term for administrative roles in contrast to “warm hands” in healthcare or education—the AE analysis indicates that such measures may already have reached their practical limits.
Implications for Public Discourse
The results from AE’s report challenge many assumptions underlying recent public debates and policy discussions in Denmark, where public administration is frequently criticized for inefficiency. In contrast, the data shows a relatively lean public sector and points to heavier administrative loads borne by companies in Denmark.
As Denmark continues to debate how to balance efficiency with service quality in both public and private spheres, findings like these add important nuance. They suggest that efforts to reduce public sector administration further may risk undermining vital coordination and regulatory functions, while ignoring more significant inefficiencies hiding in the private domain.
Key Takeaways
– Between 2010 and 2023, the share of administrative staff has remained stable in the public sector, with regional and municipal reductions offsetting national growth.
– In sectors where public and private entities operate side by side, the private companies have an equal or higher share of administrative employees.
These insights could play an important role in shaping future labor reforms and setting realistic expectations for what trimming administrative roles in government can actually achieve.
