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UNEMPLOYMENT

Swedish unemployment continues decline

Sweden's unemployment rate continued to decline in October to 7.5 percent from 7.8 percent in September, Statistics Sweden announced on Thursday.

A total of 369,000 were out of work last month, compared with 385,000 the previous month, the agency said in a statement.

“The labour market continues to develop in a positive direction with increasing employment, more hours worked and decreasing underemployment. The positive development is strengthened since unemployment tends toward a decrease and the number of long-term unemployed is not increasing,” the agency added.

In October, the number of employed aged 15 to 74 increased by 1.1 percentage points or 112,000 to 4.57 million for an employment rate of 64.9 percent. Among those aged 25 to 54, the number of employed increased by 92,000 to 3.15 million.

The number of unemployed youth aged 15 to 24 was 137,000, corresponding to a youth unemployment rate of 22.9 percent. Out of these unemployed, 65,000 studied full-time.

The total labour force amounted to 4.98 million people for a labour force rate of 70.8 percent, 74.1 percent for men and 67.4 percent for women.

Out of the 369,000 unemployed, 121,000 were full-time students. The number of long-term unemployed amounted to 123,000 in October. The number not in the labour force was 2.1 million, while those outside the labour force due to sickness dropped by 62,000 as the number of pensioners increased by 43,000.

The labour supply not utilised amounted to 18.9 million hours per week, or 473,000 full-time jobs, with a full-time job representing a 40-hour week.

Seasonally adjusted, the unemployment rate was 8.1 percent last month, down slightly from 8.2 percent in September. According to the agency, the employment rate was 65.1 percent, representing 4.58 million people in work.

“The trend for the number of employed is positive for both sexes, but stronger for men,” the agency reported.

According to seasonally adjusted data, the number of unemployed was 404,000. The number of employees increased by 113,000 persons, with growth almost exclusively within the private sector.

The number of permanently employed increased by 70,000 to 3.46 million, mostly among men.

Seasonally adjusted, the number of hours worked also rose 5.3 percent to 159.1 million. Of the hours worked, 2 million hours were performed by Swedish residents employed abroad.

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EUROPEAN UNION

Sweden heads for economic slowdown EU warns

The European Union has warned that Sweden's economy is facing a marked slowdown, with unemployment set to rise above seven percent as companies cut back on investment.

Sweden heads for economic slowdown EU warns
Jobseekers entering an office of the Swedish Public Employment Service back in 2016, when the economy was booming. Photo: Jessica Gow/TT
The August 2019 economic forecast from the European Commission's Directorate-General for Economic and Financial Affairs sees the rate of growth of Sweden's real GDP dropping to one percent next year.
 
This is slower than what is expected for all but four of the other 28 European Union members, and well below the brisk  four percent rate the country enjoyed back in 2015. 
 
“Sweden’s economy is clearly slowing down. Domestic demand and investment in particular are weak,” the report read, blaming the insipid domestic demand on a decline in investment in the housing market following years of strong growth. 
 
The slowing economy had also pushed Swedish manufacturers to hold back on investments in equipment, exacerbating the decline. 
 
The authors pointed out that planned government spending would do little to pick up the slack. 
 
“In spite of sizeable spending needs for schools, health care and welfare services linked to demographic developments, general government consumption is set to moderate in 2019 and 2020,” the report read. 
 
“Costs linked to migration should decrease, whereas new defence and health care expenses, priorities of the 2019 budget, are partially compensated by cutbacks on, among other items, labour market and environmental measures.” 
 
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While the report predicted that growth would start to pick up again in 2021, it warned that this recovery could be knocked off course by bad news internationally. 
 
“As the Swedish business cycle is closely aligned to that of its main trading partners, a deterioration of the external environment would weigh on the export sector,” it read. 
 
Real GDP in Germany and Belgium was also predicted to grow by just 1 percent in 2020, while Italy was expected to see a still more anaemic 0.04 percent growth rate. Every other EU country was predicted to grow faster, with Romania seeing the fastest growth at 3.6 percent. 
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