https://www.bloomberg.com/news/articles/2018-11-02/unemployment-is-haunting-sweden-years-after-the-immigration-boomSweden has an unemployment problem.
Even amid the longest expansion in four decades, unemployment in the largest Nordic economy still hasn’t got back to pre-financial crisis levels. The jobless rate is hovering at more than 6 percent, far above the level in its Scandinavian neighbors and in global economic powerhouses such as Germany and the U.S.
“Sweden stands out,” said Robert Bergqvist, chief economist at lender SEB AB. “If you look at unemployment, the curve in Sweden has actually pointed upward, while in many other comparable countries it is falling to levels we haven’t seen in maybe 40 or 50 years.”
That spells trouble as domestic and European economic growth is showing signs of cooling. At the same time, the country is in the midst of a full-blown political crisis with no viable government almost two months after an inconclusive election.
Sweden has been running large surpluses, but its government finances are vulnerable to growing unemployment given its generous benefit system.
While unemployment among native Swedes is at 4 percent, the figure for foreign born is more than 15 percent. According to economists the big mismatch between the needs of employers and the skills of job seekers has increased the risk of unemployment turning structural.
Reality for the foreign born, which now make up about 20 percent of the working age population, may also be worse than the official statistics suggest.
“The newly arrived are required to register at the employment service in order to get their welfare benefits,” said Roger Josefsson, chief economist at Macrobond. “After registering they are considered to be part of the labor force.”
