This study aimed to assess differences in health literacy across groups defined by labor market participation, comparing individuals in employment with those outside the workforce. The analysis used data from a nationwide Danish cross-sectional survey carried out in 2016–2017, employing the HLS-EU-Q16 instrument to measure health literacy. Individual-level socio-demographic data were obtained from administrative registers. Associations between employment status and limited health literacy were examined using weighted logistic regression models adjusted for relevant background characteristics. Compared with people in paid employment, individuals receiving various forms of public income support—including unemployment benefits, social assistance, employment and support allowance, retirement pensions, and sickness benefits—were more likely to demonstrate inadequate health literacy. The strongest association was found among unemployment benefit recipients, who showed a 78% higher likelihood of inadequate health literacy (OR = 1.78; 95% CI: 1.23–2.56). Being outside the labor market and dependent on public financial support is associated with a greater risk of limited health literacy, even after accounting for age and socioeconomic position. These findings provide further insight into how employment-related social conditions contribute to health inequalities.
