Industry 4.0 and SMEs in the Northern Jutland Region

Abstract

Being located in the Northern periphery, the economic structure of the Northern part of the Jutland Peninsula in Denmark is characterized by a relatively large proportion of firms operating in diverse industrial sectors. A minor proportion of those are high growth companies with a significant presence on international markets. Local firms operate in a diversity of industrial sectors, which are characterized by medium to high technological intensity. According to the Danish government, Danish firms cannot compete with foreign competitors based on low salaries alone because they will be undercut by international competitors who enjoy a lower cost base. In parallel, since the last financial crisis, Danish firms have struggled with the issue of low productivity, which does not justify the relatively high levels of salary. Because Northern Jutland, being part of Denmark, falls into the category of a knowledge-based society with a good educational infrastructure, Industry 4.0-related opportunities can provide a significant boost to the local economy if tackled in the right way and contribute to market development and international expansion. However, a variety of factors, such as relative distance to important markets and potential industrial partners, can pose a challenge.