A total of 12,836 people were warned by employers of potential layoffs in Sweden in the first two weeks of February alone, according to preliminary figures from the Public Employment Service. The same figure for the whole of February last year was 1,257.
It’s also an increase since January, when 5,328 people received their notices. This means that the number of people facing job cuts this year has already climbed to over half of the just over 30,000 people who were warned of layoffs over the whole of last year.
Swedish law states that employers usually have to first give employees and the Public Employment Service notice that there may be layoffs, so not all of those people will necessarily lose their jobs. Some may keep their job, or be rehired for a different job within the same company.
Here’s a link to The Local’s guide to what happens if you lose your job in Sweden.
A recent EU Commission report, which The Local covered here, predicted that Sweden will be the only country in the EU in 2023 whose economy shrinks rather than grows.
An economic slowdown is not at odds with Sweden’s economic goals. The Swedish Central Bank has been hiking the interest rate to bring rampant inflation down.
“There’s meant to be a weak recession and most things indicate that we won’t have a crash,” John Hassler, macroeconomics professor at Stockholm University, told Swedish news agency TT, arguing that the layoffs are not a sign of an imminent financial crisis.
However, several banks and other experts have criticised the Central Bank’s plans to keep raising the interest rate. The chief economist of the Swedish Trade Union Confederation accused it of “smashing household finances completely unnecessarily”.
Hassler argued that Sweden's labour market problems are not down to a lack of demand for workers, rather that a lot of people are excluded from the job market for various reasons.
“We’re not going to see some kind of mass unemployment among people who know Swedish and have a decent level of work experience,” he told TT.
In more positive news from the Public Employment Service, long-term unemployment – or in other words people who have been without a job for at least a year – is falling.
A total of 146,000 people were in long-term unemployment in Sweden in January, the lowest figure since August 2019.
Comments