OECD calls for Swedish labour market reform

Sweden needs to pare down its bureaucracy, introduce more competition in the public sector and liberalize labour markets if it is to cater effectively for an ageing population and preserve its high standards of social welfare, according to a new OECD report.

The report, which was presented to the Swedish parliament on Friday, also calls for improved competition in the construction and food retailing industries, as well as more independence and stronger powers for the Competition Authority (Konkurrensverket).

The OECD would also like to see more effort made to avoid situations where the public sector is in direct competition with private actors. The report mentions public-owned bakeries, gyms and garden centres as examples of distorted competition acting as a hindrance to the creation of small firms.

The report – ‘Sweden: Achieving Results for Sustained Growth’ – praises the country for progress made on regulatory reform since the early 1990s, which has resulted in major productivity gains. In terms of GDP per capita, Sweden comes in above the euro area average. Spending on research and development as a percentage of GDP exceeds that of all other OECD countries.

Sweden is also held up as a positive example of a country that has successfully met its own ambitious environmental goals. The use of market-friendly taxes to virtually eliminate fossil fuels from the heating and household sectors is presented as a case in point.

But these successes need to be followed by further reforms. Job creation, for example, has remained low despite a thriving economy. A more flexible labour market and greater competition would lead to more new businesses and an injection of jobs, with the services sector likely to benefit most.

The OECD carried out the report following a request from the Swedish government – in common with a number of other countries – for a broad review of its regulatory practices and reforms.


‘We agree to disagree’: Still no progress in marathon SAS strike talks

By lunchtime on Friday, talks between the Scandinavian airline SAS and unions representing striking pilots were still stuck on "difficult issues".

'We agree to disagree': Still no progress in marathon SAS strike talks

“We agree that we disagree,” Roger Klokset, from the Norwegian pilots’ union, said at lunchtime outside the headquarters of the Confederation of Swedish Enterprise in Stockholm, where talks are taking place. “We are still working to find a solution, and so long as there is still some point in continuing negotiations, we will do that.” 

Mats Ruland, a mediator for the Norwegian government, said that there were “still several difficult issues which need to be solved”. 

At 1pm on Friday, the two sides took a short break from the talks for lunch, after starting at 9am. On Thursday, they negotiated for 15 hours, breaking off at 1am on Friday morning. 

READ ALSO: What’s the latest on the SAS plane strike?

Marianne Hernæs, SAS’s negotiator on Friday told journalists she was tired after sitting at the negotiating table long into the night. 

“We need to find a model where we can meet in the middle and which can ensure that we pull in the income that we are dependent on,” she said. 

Klokset said that there was “a good atmosphere” in the talks, and that the unions were sticking together to represent their members.

“I think we’ve been extremely flexible so far. It’s ‘out of this world’,’ said Henrik Thyregod, with the Danish pilots’ union. 

“This could have been solved back in December if SAS had not made unreasonable demands on the pilots,” Klokset added. 

The strike, which is now in its 12th day, has cost SAS up to 130m kronor a day, with 2,550 flights cancelled by Thursday, affecting 270,000 passengers.