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Swedish long-term unemployment continues to rise

Long-term unemployment rose for the second month in a row last month, according to new figures from Statistics Sweden.

Published: 23 August 2024 11:02 CEST

Swedish long-term unemployment continues to rise

Almost one in four young people were unemployed last month, once figures are seasonally adjusted and smoothed. Photo: Jessica Gow/TT

“In July, long-term unemployment rose by 45,000 people compared to July last year,” Statistics Sweden statistician Louise Stener said in a statement.

The agency recently said that the Swedish economy is in a “clear recession” according to almost all indicators, and unemployment figures are also reflecting that.

The number of people aged 15-74 who were in work amounted to 5,444,000 individuals, not seasonally adjusted – that’s a decrease of 80,000 compared to July last year, but not all of those people were classified as long-term unemployed (unemployed for at least 27 weeks).

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How to find a job in Sweden in three months

Long-term unemployment amounted to 164,000 people, with significant differences when broken down by age and gender.

There were 71,000 women and 93,000 men in long-term unemployment, and 149,000 young people (aged 15-24 years). Youth unemployment hit 17.7 percent, which is an increase of 6.5 percentage points. This data is not smoothed or seasonally adjusted.

The unemployment rate for 15-74 year olds according to smoothed and seasonally adjusted data stood at 8.3 percent – that’s the highest unemployment rate in a decade, including the pandemic. Youth unemployment was even higher, at 24.4 percent.

READ MORE:

‘Make yourself employable’: Minister’s warning as Swedish unemployment reaches 10-year high

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Swedish finance minister opens up for rise in spending in next budget

The finance ministry has set the so-called reformutrymme, literally “space for reforms”, at 60 billion, up from the 40 billion of spare cash the government had for new measures in its 2024 budget, which she said would be allocated both towards putting more money directly in people’s pockets and towards investment in welfare and infrastructure.

“It’s not all wrapped up yet, but a lot of it is wrapped up,” Svantesson said of the ongoing budget discussions between the three government parties and the far-right Sweden Democrats. “We believe that 60 billion kronor is a good balance. It’s a significant rise from this year.”

She said the 20 billion kronor in increased spending room would enable the government to be bolder in its plans, and could also be augmented by making cuts in some places in order to free up money for spending elsewhere.

Don’t miss The Local’s news and analysis about the state of the Swedish economy by downloading our app (available on Apple and Android) and then selecting Economy in your Notification options via the User button

“Then we can do a lot more if we prioritise in other ways: if you don’t promise something for everyone, but instead do what you think is important,” she said.

She promised proposals to boost household spending power and stimulate the economy, something she said was necessary given that Sweden remained in an economic slump.

READ ALSO: Sweden in ‘clear recession’ as economy continues to tread water

“In a long-drawn-out economic downturn the economy needs to be stimulated,” she said.

At the same time as the press conference, the government adjusted down its forecast for the economy, with GDP growth for 2024 reduced from the 1.4 percent forecast in June to 0.8 percent.

It expects GDP growth to be higher in 2025, however, increasing the forecast from 2.4 percent to 2.5 percent. The unemployment rate for both 2024 and 2025 is predicted to be 8.3 percent, a slight reduction from June’s forecast.

The government expects inflation to come in at 2.8 percent in 2024, falling to 0.9 percent in 2025.

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