Sweden risks facing severe labour shortages

Sweden risks facing severe labour shortages
Over the next ten years, the number of native-born Swedes of working age will decline by 100,000. Without more immigrants, we will be unable to sustain our welfare standards, writes Olle Wästberg, head of the Swedish Institute.

Unemployment is sweeping across Sweden in the wake of the financial crisis and the international fall in demand. Yet if we want to sustain welfare in this country in the long term, it is precisely now that we need to launch a campaign to attract more immigrants to the Swedish labour market. The Swedish employment sector’s ability to adapt to changing conditions is limited. The Swedish Migration Board publishes a regular list of labour shortages showing which kinds of jobs are most in demand. It contains all kinds from casualty department nurses and bakers to dentists and sanitary engineers.

Next year, for the first time, young people entering the labour market will be fewer in number than retirees. And for each year after that, new pensioners will exceed young labour market newcomers by about 2,000. Over the next ten years, the Swedish-born population of working age will decline by 100,000. In Europe as a whole, the working-age population will decline by 40 million over the next 40 years. Consequently, a number of European countries have embarked on recruitment drives of various kinds – but not so Sweden, until now.

Basically, increased welfare and prosperity means more people working in an increasingly productive way. In a report to the Swedish Government’s Globalisation Council last year, research scientist Philippe Legrain observed that increased immigration could help finance the welfare state by boosting economic growth. Without more fortune-seeking immigrants, we will be unable to meet the challenges facing the welfare system, particularly as regards caring for the elderly.

If we let the population shrink, welfare standards will decline. Apparently, Sweden’s municipalities and regions have now realised this. Almost all Swedish regions have set population targets that emphasise growth. The Greater Gothenburg area wants to have a population of 1.5 million in just ten years’ time. Stockholm wants to have 600,000 more inhabitants over the next 20 years.

Traditional out-migration counties such as Gotland and Norrbotten are also going for growth. They are on the right track – Paul Krugman was awarded last year’s Nobel Prize for Economics for demonstrating how labour influx boosts a region’s productivity and strengthens its economic position.

Naturally, we must take advantage of the labour reserve we have in Sweden: retraining, relocation, courses adapted to labour market needs etc. But that won’t be enough. And it would be unwise to think we can eliminate bottlenecks in the labour market simply by taking measures to help today’s unemployed.

A distinguishing feature of Swedish immigration policy over the past 40 years or so has been a relatively generous attitude towards refugees and virtually a total rejection of labour immigrants. Almost exactly a year ago, Sweden introduced new legislation on labour immigration. This may prove highly beneficial. Most of those who move to Sweden are aged 20–30 and have been educated in their country of origin. So far, however, labour immigration has had little impact.

Future demographic considerations are not the only reason why we should make it easier for people to come to Sweden to work. There is much to suggest that immigrants improve our trade relations with the world around us.

International migration hastens the globalisation process. People acquire valuable networks of contacts. When trained people from other countries work for a period in a country like Sweden, both parties benefit. Those who come here gain valuable experience and acquire skills, networks and income, which in turn often benefits their families and native countries. In describing the advantages of academic mobility, the UNDP no longer talks about ’brain drain’ but about ’brain gain’. Each year, some 31,000 foreign students are to be found at Swedish universities. If some of them stay and work here, Sweden gains.

Almost a quarter of the 300-odd Americans awarded Nobel prizes over the years came to the US as immigrants. Swedes don’t always possess the best ideas – these develop in the interaction between different outlooks and approaches. Diversity, such as we find in New York or Berlin, is a magnet that attracts talent.

At the Government’s request, the Swedish Institute is now marketing Sweden as an attractive employment destination. A feature of this drive is a new website, Workinginsweden.se, which guides potential immigrants into the Swedish labour market step by step and tells them what to expect in Sweden.

A number of studies show Sweden to be an attractive place for people wishing to work or study in another country. The labour market is one aspect, of course, but the picture is broader than that: Sweden must become a country known for its good schools and its good environment, for its lively cultural scene and for its safety and security as a place to live. Many advantages need to be identified to offset the December darkness.

The website and the coordination of efforts by various agencies and organisations to reach foreign job-seekers is part of a broad-based offensive that includes the government-run project Kosmopolit and is designed to promote trade by exploiting the skills of people born abroad. Job fairs in Asia are packed with European government representatives seeking to recruit key labour. It’s time for Sweden to join in.

Olle Wästberg, Director-General of the Swedish Institute

This is a translated version of an article published by the Swedish daily Svenska Dagbladet. Translation: Stephen Croall.


The web portal Workinginsweden.se provides a step-by-step guide to the Swedish migration process, which has become a lot easier for non-EU/EEA citizens due to new rules in Sweden. The portal also describes some of the advantages of a work life in Sweden. Workinginsweden.se is produced, operated and developed by the Swedish Institute.

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