Sweden’s income gap shrinks for first time since financial crisis

Sweden's income gap shrinks for first time since financial crisis
Income disparities have grown in Sweden over time. Photo: Adam Wrafter/SvD/TT
Sweden's growing income gap has decreased for the first time since the financial crisis. But foreign residents are still much poorer than native Swedes.

On the whole, Swedish households' economic standard continued to increase in 2018, according to a new report by number crunchers Statistics Sweden on Wednesday.

But compared to 2012-2015, when the economic standard improved by 9.0 percent, it increased at a much slower rate in recent years, with a modest 3.0 percent growth in 2015-2018 and 0.8 percent in 2018.

Meanwhile, the income gap shrank in 2018 to the lowest level since 2014. It was also the first time the income gap between rich and poor decreased in Sweden since the financial crisis of 2008.

The decrease can be linked to lower capital gain for the wealthy in 2018, a challenging year for the Stockholm stock exchange.

When capital gain was excluded from the calculation, income differences remained relatively stable in 2018 and the 2010s. And despite the decrease in 2018, income inequality has grown in Sweden over time.

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Statistics Sweden's report also noted that the income gap between foreign-born people and people born in Sweden has remained more or less stable in the past decade, including in 2018 when foreigners' economic standard was 77 percent of native Swedes' economic standard.

In terms of fast income growth, single women in their 20s without children were the winners of the past decade, racking up a 28 percent income growth between 2011 and 2018 (compared to 19 percent for single and childless men in the same age group).

The year 2018 was also the first year in which more than 100,000 people – three quarters of whom were men – earned a total income of more than one million kronor ($103,941). 


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