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Purpose We explored if patients with treatment-resistant depression (TRD) go through different states of labor market affiliation during their course of illness before they return to work or obtain early retirement as compared to patients without TRD. Methods All adults between 18 and 58 years with a first-time hospital contact due to depression in Danish patients' registers from 2000 to 2014 were followed in a nationwide labor market database. At time of TRD (index week), TRD patients were matched with patients without TRD in a 1:2 ratio. Sequence analysis and logistic regression were applied to explore the association of TRD and labor market affiliation and measures of transitions between labor market states 52 weeks before and after the index week. Results At the index week, 14.1% of patients with TRD were in employment, whereas the proportion was 26.4% among non-TRD patients. Over time, the proportion of patients in employment increased slightly to 25.5% for TRD and 33.7% for non-TRD patients. The proportion of TRD patients with sickness absence at index was 47.0%, while the proportion was 26.2% for non-TRD patients. The adjusted odds of a below mean volatility of labor market transitions, characterized by more episodes in passive social transfer payments and disability pension, were higher among patients with TRD compared with non-TRD patients (OR 1.63, 95% CI [1.56-1.69]). Similarly, the adjusted odds of a below mean integration into employment were 1.63 higher among TRD patients compared with non-TRD patients (95% CI [1.56-1.70]). Conclusion Patients with TRD have higher levels of sickness absence and lower levels of reintegration into the labor market after meeting the criteria for TRD compared with patients without TRD.