Denmark: One Strike Against The Economy

The government stepped in on May 7 to halt Denmark's worst strike in 13 years, as the 10-day stoppage crippled one of Europe's most dynamic economies.

Prime Minister Poul Nyrup Rasmussen implemented an agreement that gave workers more vacation time, but at a cost of smaller pension payments. The deal was only a bit better than the contract turned down earlier, so union officials were not happy with the intervention. But the strike of more than 400,000 workers had already closed factories, schools, and hospitals, and sharply cut food and energy supplies. The Finance Ministry calculated that the strike would cut real gross domestic product growth in 1998 to 2.2% from the initial forecast of 2.7%. The economy was already slowing due to tighter monetary policy and falling oil prices.