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Unemployment in Sweden: Causes and Solutions Research Paper



Unemployment is a challenge to many states and Sweden has not been exempted from it. There have been measures that have been put in place to try and curb this problem. These measures have worked to a certain extent but some of them have worked against the intended goal of bringing solution to unemployment. This is for example some welfare state arrangements which have contributed to an increase in unemployment instead of reducing the rate. There have been other factors too which have contributed to the rising trend of unemployment in Sweden but the paper shall majorly deal with welfare state.


The aim of carrying out this research is informed by the fact that Sweden was a country that was never considered relevant in Europe in the period before the World War II. However, many people in Europe and in the United States at large were however astonished by how she managed to pull herself together and have a very strong economy. This research looks at one of her most celebrated program that turned out later on to be the source of misery to a good number of her population; that is the welfare program that was adored by members of others countries who viewed it as a probable future approach in solving the social problems of the people.

The information on this topic was obtained from secondary sources since there was no formal research that was carried out. Therefore the information gathered when carrying out this research was obtained from books, journals, websites, as well as articles by various writers. Although a number of writers have authored a lot of materials concerning Sweden very little information is available in regard to her welfare program. Therefore this proved to be a major set back while writing this paper. Furthermore, some of the materials available lacked authors which made it an uphill task to identify the authenticity of such materials.

This research used the quantitative research because as earlier stated I have used secondary data while carrying out this research as well as historical method which is part of qualitative research method. Quantitative research involves looking at what has been done by other researchers in order to test the reliability and adequacy of such work. That is, when using quantitative research the main objective is to establish whether the stated work by other researchers holds water. The main reason for using this research method is that it has a number of advantages that include; when using this research method I was able to measure and analyze all the data that I had. Since I had all the required materials to be researched on at my disposal, I was able to look at it more keenly to identify if it was worth using it depending on my research topic.

To add on that, quantitative research is applicable when it comes to the testing of hypotheses in an experiment. This is because when using statistics it is very possible to measure data whether it is available in form of grouped or the ungrouped data. When using quantitative research method it is also possible to establish and study in depth the correlation between any two variables that are being investigated; that is the independent and the dependent variables. When using the historical method one looks at some of the recorded past events, that relate to the current situation he or she is researching on in order to recommend measures that should be put in place to avoid or encourage such an event from happening again. Therefore in this case I will look at some of the measures that should be put in place to make sure that the welfare program does not bring about job losses among the people in Sweden.

Literature review

According to Immervoll & Herwig (p 3) prior to the World War II Sweden was regarded as one of the impoverished states in Europe. However, over the years after the end of the World War II she has managed to wipe out all slums and also started a welfare where the disabled and the unemployed are taken care of. He says that at one time she became a darling of many European countries and the United States of America. Most of these countries wanted to borrow that concept that she had developed to take care her rising population in the late 1960s and early 1970s.

However, he notes that the idea of welfare later on brought about unemployment amongst her people because in the early 1990s there was a regime change from the Conservative Party to the Social Democratic Party. He says that these two parties had different views on how to address the welfare of their people. As a result the new regimes failed to march the successes achieved by their predecessor and as a result many people ended up losing their jobs in both the civil service and in the private sector. According to him the Social Democratic Party government should have sat down with the members of the previous regime so that the get to know how they addressed such an issue even when the economy was not performing as expected.

In addition Bergmark & Palme (p 4) says that the whole process was a very expensive affair and therefore if the subsequent government did not do a proper planning the welfare was bound to fail. He said that the Social Democratic Party led government to fail to put in place proper measures that would prevent the system from coming to a stand still. As a result of this the government ‘ceased’ from supporting the idea and therefore what followed was massive job losses in all sectors of economy. He says that according to the government of the day this whole program was very expensive to sustain since it created a deficit in the national budget. The government considered the fact that prior to the introduction of this program in the past the previous government used to record massive surplus in their budget but now owing to this program the budget has been experiencing deficits in her budgets.

Barry (p 34) contends that the rush by the Swedish authority to join the European Union was also a major contributor to the poor performance by the welfare program and rise in unemployment. He argues that before a European country was admitted in the European Union it had to make sure that her budget deficits were very low. To the Swedish government that used to experience high budget deficits, he says that the only available option was to do away with this welfare program that had been blamed for bringing about huge budget deficit. As a result many people whose livelihood depended on this welfare program were sent packing by their employers.

He says that in order to avoid such a devastating effect on her population the government should have reduced her expenditure in other sectors of economy other that touch on one sector that result in many people remaining jobless. In addition, he states that the process of doing away with this program should have been implemented in phases. This way he argues that the government should have had enough time to gauge the impact it would have once it was done away with. As a result he notes that the government at such a time would have put in place adequate measures to cushion those who would have been affected by such a move.

The idea of opening up of boundaries among the European Union has also been blamed as a cause for the failure of the welfare program and the subsequent loss of employment by her members of public. According to Ginsburg, Helen & Rosenthal, Marguerite (p 3) the government lost a lot of money that it used to collect as tax on the imported goods in the country. As a result they say that the government realized a lot of deficit in the budget. As the other scholars have also noted, the government decided to scrap the welfare program which went a long way in causing massive job losses in a number of government and private sector departments.

To add on that Corrado, Luisa, Londoño, David, Mennini, Francesco, Trovato, & Giovanni points out that the government came up with reforms that ended up being in favor of the rich. These tax cuts reduced the government revenues drastically hence it was not able to meet all her obligations as it intended. They note that some of these tax reforms led to a serious crisis in Sweden that almost made some of the financial institution like banks collapse. As a result the government was forced to bail out these financial institutions. To them, during this period the banks interest rate increased to an all time high of five hundred percent that had been brought about by the overvaluing of kroner. Therefore he says that the government was forced to suspend other things like the welfare program in order to address the issues it considered urgent and threat to the economy. As a result of these measures a good number of people lost their jobs. They note that government should have prioritized its activities in order to reduce the number of people who were to be affected by her actions of the program.

Case Study

Background about unemployment in Sweden

For a long time since the end of World War II, Sweden enjoyed a manageable number of people who were unemployed. Businesses did very well as they were not affected by the war. This therefore made the country enjoy increase in business and especially when it was necessary for Europe to be rebuilt. Sweden continued to improve in terms of employment to its citizens because of the process of modernization that it experienced in the 1950’s. The rate of unemployment stood at 2-3 percent. In 1983, the level of unemployment rose to around 3.7 percent. Between 1983 and 1990, the rate of unemployment reduced to around 1.5 percent. In 1990, there was a drastic change in the levels of unemployment. The levels shot up especially due to the loss of half a million jobs. This was so in the manufacturing industries. By the year 1997, the rate of unemployment had gone very high reaching 9.9 percent.

Unemployment in Sweden has been a major problem in the recent years. The rate of unemployment has however not affected all social groups equally. One of the groups that have been majorly affected by the problem of unemployment is the young people. The inequality of the unemployed population has also been witnessed between the genders as more women than men are unemployed (Immervoll pg 34).

In the past, Sweden did not suffer much from the problem of unemployment. For example during the global recession in the 1970’s, the country sought to alleviate the consequences of this global recession in the area of employment (Ringen pg 1). One of the ways was to help both large and small scale industries not suffer losses because of the decrease in the number of exports and other losses which would probably arise (Lindbom pg 1). The government therefore tried to offer financial assistance to such companies that were in danger of shutting down. Other measures included coming up with laws which would make firing of employees more difficult.

Among the unemployed, there are those involved in active search for jobs while others are not. There are also those doing part time jobs but are available for full time jobs if offered to them. The problem of unemployment affects both the educated and the uneducated although it is worse to the uneducated. The level of education is a vital aspect when we talk about employment or unemployment. This is because it dictates the chances of a white collar or blue collar job. It is common in many places for any educated person to have a higher chance of employment than an uneducated person. The higher the level of education the more one is likely to get a better and well paying job sooner than a person who is illiterate or semi-literate. This has been the case in Sweden also.

Another factor that determines the chances of one’s employment is whether one is a native of a foreigner. Natives generally have a higher chance to get a job than a person who is has migrated to the Sweden.

Although this has been the general picture, several factors have been seen as the cause for unemployment among the young people specifically. One of them is the influx of graduates into the job market making it hard for all of them to get jobs suitable for them because the available vacancies get filled very fast.

The decline in economy is also a challenge to those seeking for jobs. During such a time, there may be very few jobs yet many job seekers. The imbalance between the available jobs and the job seekers creates a big problem of unemployment, which calls for the government’s intervention through other means at its disposal.

Another challenge is the availability of jobs, which are not very secure and are seasonal in nature. The young people tend to accept offers made by companies who offer part time or temporary jobs and since they are only hired for a period, they end up suffering from unemployment after a short while. The other major contributor of unemployment, mostly among the youth is the strict state law on welfare.

Welfare state and unemployment in Sweden

Welfare state has to with measures set up by a government to help its citizens in need for example the aged, unemployed and the children among others. It is hard to talk about unemployment in Sweden without looking at how welfare state arrangements have contributed to this problem. Welfare state in Sweden has its roots in the United Kingdom where it was set up to help the poor meet their basic needs in life. Welfare state has been applied in other countries also for example in Germany. In Sweden, Certain arrangements have been done by the state with the aim of curbing the problem of unemployment, protecting the employees from unlawful dismissal from work and promoting equality in employment for both men and women. Before 1990’s, Sweden had a relatively low rate of unemployment. It enjoyed high employment rates because most of the citizens were able to themselves a job either within the private or the public sector.

The rate of unemployment increased rapidly after 1990’s due to economic problems faced by the country. This problem affected most of the people and therefore the government had to come up with ways to curb it. One of the ways was giving retirement fund only to those who were working prior to retirement instead of giving to all the elderly regardless of whether they working or not (Ginsburg & Rosenthal pg 2). The welfare state included giving people 90 percent of what they used to earn previously in 1998. This was a reduction of what was being given out because one could get up to 91.7 percent. The amount given out as welfare continued to reduce until it came to 75 percent in 1996. The changes in percentage of welfare that one would get changed according to the government that was in place.

Another way was use of laws that would make it hard for employers to fire their employees easily. Although this had its advantages, it also came with negative effects. These laws were set with the aim of protecting the employees from being laid off very easily and without notice. This has however been a major problem to the employers because they find this rule too inflexible and very demanding on their part. Enlisting new workers in the companies and other organizations therefore becomes a challenge to them because it may end up being expensive and tedious if or when they want to fire the workers in case of underperformance or when they just want to reduce the number of employees for economic reasons.

According to Corrado and colleagues (pg 47), another arrangement made by the state is offering the unemployed financial support before they get jobs to sustain themselves. This may not seem like a problem without looking at the possible consequences. When those who are unemployed are offered with financial assistance, there is laxity in looking for jobs (Holden pg 306). Also, the starting salary they are likely to accept becomes very high and potential employers may not be in a position to offer them the expected salary. This trend increases the duration of unemployment and also the number of the unemployed because they are being provided for their basic needs and hence they may not even be actively involved in looking for suitable jobs.

According to Bergmark & Palme (pg 110), another cause of unemployment could be the active labor market policy designed to assist the unemployed acquire a job. This type of intervention involves job establishment and education courses and programs for the unemployed. This too may not seem like a big problem at first unless it is scrutinized under the effects it brings to the unemployed. This type of intervention affects the people seeking for jobs by making them absent in case of an available job and hence there exists job vacancies with no people to fill them and yet those who could have filled them are still not permanently employed.


What causes unemployment in Sweden?

To show the causes of youth unemployment in the Swedish context, from the perspective of young unemployed and social workers, in order to provide guidelines for successful prevention strategies of youth unemployment. This study will also enable us to begin to understand the ethnic dynamics, among other factors, affecting youth in their attempts to integrate into the job market.

The in-depth research on the causes of unemployment has revealed that there are many causes of unemployment in Sweden. In Sweden, these factors can be classified into young unemployed, the Sweden natives and finally the immigrants.

One of the causes of unemployment in the case of Swedish youths is lack of work experience and education which makes them to lack the skills that are sought in the market at any given moment. The other factor is state policies that may disqualify someone from doing a certain job due to lack of a specialized skill. There is also lack of information about the available jobs on the side of youth immigrants.

From the perspective of immigrant youths, unemployment is as a result of the same factors that affect native youths plus others like lack of proficiency in Swedish language, poor network and lack of recommendation.

In the case of social workers, youth unemployment is as a result of lack of education and required experience, state policies and others are as related to the other categories above. There is also low level of knowledge of Swedish language, discrimination among others

The relationship between the price of oil and unemployment in Sweden

A Swedish citizen is less dependent on oil compared to an average American citizen. If this is the case a Swedish person will not be affected in the same proportion if an increase in the price of oil occurs. An average person in the U.S. consumes, directly or indirectly through industry, 25 barrels of oil per day compared to a person in Sweden who consumes 13 barrels. By this we can clearly see that a person in the U.S. will be more negatively affected in the event of an increase in the price of oil. If there is an increase in the price of oil in Sweden, this will not have the same effect compared with other large industrialized countries, since the dependence on oil is not as strong.

Many researchers have through history concluded that changes in the price of oil cause changes in the unemployment level. Different tests with different variables by various researchers have altogether supported the existence of this phenomenon. Previous research has been done on the U.S. economy. Our tests have been conducted using Swedish data and the outcome turned out to be the same. Even though the scale of the economy and the dependence of oil are much smaller in Sweden compared to larger industrialized countries the result of the tests was significant.

The fact that we found a relationship between the oil price and unemployment shows how influential the price of oil is to the Swedish economy. Our linear regression relating current changes in these variables indicate a positive relationship between them. However, we are not able to conclude whether a change in the price of oil will have a positive or negative effect on unemployment in Sweden, due to the fact that some of the coefficients in the

Granger causality regressions are positive and some are negative.Recent research have been conducted in the field testing the oil price effect on unemployment. Bean 1994, Phelps 1994, Nickel 1997 and Blanchard 1999 present studies were oil act as a primary determinant of unemployment. They use fractional integration and cointegration instead of classical approaches. We suggest further studies in the area of different approaches to find out if there exist a relationship between the price of oil and unemployment in Sweden.

Technological Change

Technological improvements allow for economic growth which is a necessity for increased standards of living in an economy. This is a long-run effect, however, and in the short-term the introduction of new technology can result in unemployment. The impact on employment in different sectors is widespread. There has been a marked change in the skills required for existing jobs and new jobs. There has been a shift in demand towards more skilled employment in manufacturing and in other industries. The number of those with the relevant skills is almost equal to those without the skills; that is the gap I very wide. This results in unemployment arising from mismatch.

The impact of technological change on the unemployment rate is dependent not on the level and the extent of this change but, more fundamentally, on the ability of the economy to accommodate the change. The economy must be able to upgrade the skills of the labor force and redesign firm organization if the technology improvements are to efficiently integrate into industries. The US and Japan, which are both characterized by low unemployment, are among the fastest growing economies to have adapted their economy’s structure to one based on high-tech and knowledge-based activities. This is what many other OECD economies have failed to do and hence the job-loss element of technological progress has dominated.

The Changing Global Economy

Having looked at some of the factors that impose rigidities on the labor market I will examine how continuous changes in the global economy may affect the unemployment rate. In particular, I will look at technological change and the expansion of international trade. Both of these changes are not, in themselves, primary causes of unemployment. Rather it is the failure of economies to adjust to these changes which has altered the face of employment and has hence impacted on unemployment in various sectors.

International Trade

The increased openness of economies and the massive growth of globalization have meant that all OECD countries are trading more with each other, and with non-OECD countries. This increased trade has had a significant impact on behavior within these countries. The increased competition arising from trade is forcing firms to be more efficient and economies are altering the structure of their employed labor force so that the nation can have a competitive advantage.

Trade is changing the nature of jobs in the economy by displacing labor intensive jobs and supplementing them with jobs in the capital-intensive sector. In a fully flexible market this would have no effect on overall employment as suitable adjustments would be made. We have already seen, however, that the OECD labor markets are not flexible and hence unemployment can emerge as a by-product of the changing nature of jobs.

Finally, our analysis indicates that there does not seem to be any single cause of the rise in OECD unemployment. Rather, there have been a number of adverse developments, in particular an increasing rigid labor market and a failure, especially in Western Europe to adapt to new technology and the competition of a more global market, which have all acted in the direction of raising unemployment. Much of the thrust of policy advice emanating from institutions such as the OECD has been to enhance labor market “flexibility” by limiting union power, improving retraining and so forth. The United Kingdom has probably gone the furthest in enacting such structural policies, although so far with little beneficial effect on unemployment.

The moral is that, although such policies may improve the functioning of the labor market over the medium term, additional specific measures may be required to reduce the already high unemployment that has been allowed to develop during the 1980s. These could take the form of active labor market policies such as those pursued in the Nordic countries, where an exceptional sense of social solidarity and an appreciation in the benefits from the welfare state has allowed resources to be diverted to expanding state service. It is only through such creative policies to replace the “benefit principle” with an “employment principle” that the current crisis will be overcome.


As we mentioned there were many reasons that lead to increase unemployment in Sweden, however there were some solutions also been taken to solve or reduce unemployment problem. The use of social welfare programs that helps the disadvantaged in the economy could be a stronger factor in solving the problem of unemployment. Care should be taken in this case to ensure that the program on benefits those that deserve it, that is, those registered as unemployed. It must be proved that that they sought for jobs but to no avail. Such benefits include among others, the insurance to the unemployed and their compensation. There is also welfare and they are also given aid that will help them in retraining. These programs enable the unemployed to cope with their short-time hardships and at the same time have more time to seek for jobs.

There are also laws enacted in order to deal with the protection of employment. This will protect them from unfair dismissal by their employees and this will reduce the number of unemployed persons.

These Laws may not always be absolutely beneficial because they also have some demerits. First, the employers will not be willing to recruit more employees to the organization because they fear that it may not work well with them. They find it too expensive to recruit workers who will be forced to retain despite the challenges that may arise.

Another solution entails supporting those that are jobless by giving them some benefits to help them cope with hard economic times. Some labour market policies are also put in place in order to enable the jobless find jobs with ease. These factors falls under government intervention and Sweden has employed it for a long time. These policies may include trying to create jobs for the unemployed and also training programs which will enable the unemployed to be absorbed in the job market.

There are also strategies that are employed in order to help the low wage earners and this will help in easing the pressure of unemployment. He government provide some subsidies to these low income earners maybe through reducing their taxation.

Phelps (1994, 1997) and Dreze and Malinvaud (1994), felt that this is an effective way of dealing with unemployment that where the government tries to reduce the taxes of the employed. Subsidies to low income earners are more effective that the other strategy of reducing the tax by the other groups. This is because the subsidies will reduce the labor costs especially where it is not possible to reduce the wages. Reducing taxation may not be as effective as the other strategy. This solution considers better for private sector job creation. By increased wage differences for groups with different qualifications can potentially contribute to this, by suggest the less skilled to obtain greater skills and by reducing the cost of low-skilled labor, particularly for private service sector jobs. Sweden offers special subsidies to employ youths as the unemployment among young people are more.

Another solution that been taken as a simple measure is to support financially employers who are willing to reduce hours rather than lay people off. The idea is straightforward: employers who are faced with reduced demand can either lay off workers or reduce hours. If they reduce hours for any worker, the government puts up 60 percent of the lost pay for these reduced hours. The worker keeps his/her job, with reduced hours but the pay is not reduced nearly as much.

People’s opinion about unemployment and the welfare state in Sweden

The Swedes have had different opinion about the welfare state. On one hand, the welfare provided by the government is very useful to people of all social classes. This is because it benefits the elderly, the unemployed and the physically challenged meet their basic needs. For this reason, many people are comfortable with the welfare state. On the other hand, some people are uncomfortable with this arrangement because of the high taxes levied on them to cater for this welfare state (Sven pg 1).

There is therefore a mixed reaction from the people because of both the benefits and the cost incurred in catering for such services. However more people support the rate of taxation and would rather pay for the taxes than have the welfare state removed (Lindbeck, 19).

Analysis of case study and literature review

The history of the unemployment/employment in Sweden could be traced back in the period following the end of the Second World War. During this period, the level of unemployment was too low because there were no war effects. This created a robust environment for the businesses. Without the effects of the war, it means the country enjoyed a conducive political environment and investors would feel secure in their operations. This kind of environment was capable of creating more employment opportunities.

The level of unemployment also reduced in around 1950s due to modernization process that took place.1950s seem to be the period where intense modernization took place although the process of modernization started in around 1860s and intensified in the 20th century. Modernization has the effect of changing a nation from being a stagnant rural society to a modern and vibrant industrial society. These changes also have the effects of creating more job opportunities thus reducing the level of unemployment.

As noted in the case above, from around 1950s, the level of unemployment in Sweden was raging from 2 to 3 % and the trend continued to around early 1980s. This statistics means that only 2-3 percent of the persons who were willing and able to work and the prevailing wage rate could not find work/employment. The other part of over 97% of those with the right skills, willing and able to work at the prevailing wage rate could find jobs. This is a healthy trend for a sound economy.

The trend of unemployment in Sweden did not remain constant for a long time. For instance, the rate increased to 3.7 % in around 1983. This meant that 3.7% of potential workers could not find jobs. A slight increase in the level of unemployment could have a significant effect on the economy at large. For instance, when the level of unemployment increases, it means that the dependency ratio is high. The unemployed will be depending on the employed for survival. This will reduce the standard of living of the employed. This is the same picture that will be reflected for the economy at large. The demand for goods and services will also go down especially the agricultural products. The prices of commodities will go down and therefore farmers will get less income for their produce.

The trend of Sweden unemployment has been changing during the 19th and the 20th century. The trend has been of nonlinear nature recording increases and decreases overtime. Following the increase of 3.7% recorded in 1983, the rate reduced to 1.5% between 1983 and 1990. After 1990, the levels increased drastically and it was about 9.7% in 1997. This means the economy became worse of as a result. This has the effects of increasing the standard of living due to high dependency ratio. Social statuses of different groups of people also were seriously affected. Women children and young people are the mostly affected in these kinds of scenarios. The rates of unemployment were higher in women and young people than in men. Where there is high level of unemployment, the cases of discrimination in job opportunities is usually very high. The unemployed

Young people and women who are unemployed will have to depend on the employed men for survival. This would result to poverty especially where the salaries of the employed is not enough to cater for the needs of those depending on them.

Sweden, despite the escalating rate of unemployment, has tried to alleviate the situation in order to improve the employment sector in the economy. As noted in the case above, the government of Sweden managed the global recession in the 1970’s which could have resulted to collapse of industries and loss of employment. The government bailed out struggling companies so that they do not go bankrupt so that they may continue offering employment. This is done is order to enable the companies to recover the losses caused by incidental events. The use of strict employment laws enabled the employees to retain their jobs despite the effects of depression.

Cases of unemployment in Sweden were justified by a number of factors. First, there are cases where the jobseekers are too many and they are no jobs to suffice them. This results to a very serious unemployment case in the country where it occurs. Due to slow growth of the economy in harsh economic times, there are no new job opportunities coming up. If the rate of those people leaving school to seek jobs exceeds the available opportunities, the cases of unemployment arise.

The period preceding world war two did not portray Sweden as a glorious nation in Europe. It was regarded as a nation full of poverty due to its high levels of unemployment made the standard of living to be very low. The process of staging a comeback for Sweden began after the war. The post war period was characterized with drastic change in the economy. The slums were eliminated and welfare to help the disadvantaged was started.

This had the effect of improving the living standard of people and reduction on the dependency ratio. This was happening around 1960s and 1970s when the population was also increasing. These strategies were necessitated by the need to take care of the growing population. However, though the strategies seemed bright even to the other countries in Europe, it turned out to be an expensive program when the new government that succeeded conservative party failed to embrace it. It became detrimental to the economy and many people lost jobs.

Despite the change of government, the rate of unemployment also soared when Sweden joined the European Union. He economy was not performing well when she joined EU. This broadened the budget deficit that Sweden was experiencing and the welfare program had to be sacrificed because it became too expensive for the country. As a result, the dependency ratio increased and the living standard of people also declined. Many people lost their jobs when the welfare program was scrapped. This raised the level of employment in the economy. The opening of trade boundaries of the countries within the European Union was also a big blow to Sweden. The revenue the government used to collect in terms of imports duties was eliminated. This means that the net income from abroad was reduced. The national income also reduced and therefore the budget deficit expanded.

The government attempted to restore the benefits of the welfare program by reducing taxes but this strategy also failed. The rich ended up paying less taxes and the government suffered decline in tax revenues. Because the tax policy was “pay as you earn”, the rich paid less taxes and as a result the government revenue reduced. This posed a problem with meeting the budget. This caused a financial crisis with some of the financial institutions suffering most. The government responded by bailing out the financial institutions so that they do not collapse. Many people lost their jobs during the crisis. The level of unemployment increased as a result. The economy became worse of due to low standard of living. The level of productivity in the economy also fell and the per capita income reduced as result. The whole picture of the economic performance is negative when such matters arise.

Unemployment in Sweden has therefore taken a long journey and has a long history dated back to Pre-World War Two. The government has although been on the vanguard to redress the situation. Most of the strategies sounded bright but due to lack of proper management, they failed to solve the problem and worsened it instead. If the new governments could have embraced the strategies that were laid by the Conservative Party, the situation could have been solved in those days.

The joining of the European Union by Sweden was also a bright idea but it failed due to poor timing. The economy of Sweden was not performing well and the negative consequences befell her. The rate is still high today compared to the low levels experienced in the 19th and the 20th century although with slight improvement compared to some years in the past. It is currently about 8.3% compared to 4% in year 2003. Many changes have taken place in the Sweden economy and the current level of unemployment may be favorable for the economy.


Since its implementation in Sweden, the welfare state has been beneficial to many people. Despite the high cost that it at times comes with, it is still a necessity for the Swedes. In the area of employment, it is important for long-term measures to be put in place to curb the rising trend of unemployment and especially among the youths (Bengt p. g 1). Although the government has tried to do so through several ways discussed in the paper, there is a lot that still needs to be done to ensure that a long-term solution has been found. This is because the existing measures seem to add to the Problem instead of reducing it.

In addition, the government should explore other avenues that might help her to come up with a better and a sustainable program. This is because many job losses have been lost because the government is still in need of maintaining this to her people. The program is very costly and therefore unless other form is found then the government stands to loose the battle in sustaining it in future. Just as other countries envied her because of such a program, she should also look at other models that being used by other countries elsewhere that might prove to hold the key to this puzzle.

Works Cited

Barry, Robert. The welfare state in transition: reforming the Swedish model. Chicago. The University of Chicago Press. 1997.

Bengt, Furåker. Unemployment and Welfare State Policies in Sweden. Web.

Bergmark, Ake & Palme, Joakim, , International Journal of Social Welfare, Volume 12, Issue 2, pages 108–122, 2003. Web.

Corrado, Luisa, Londoño, David, Mennini, Francesco. & Trovato, Giovanni “The Welfare States in a United Europe.” European Political Economy Review, Volume. 1, No. 1, pp. 040-055, 2003. Web.

Ginsburg, Helen & Rosenthal, Marguerite. The Ups and Downs of the Swedish Welfare State: General Trends, Benefits and Care giving. New Politics, Vol XI No 1, 2009. Web.

Holden, Chris. “Deco modification and the Workfare State.”POLITICAL STUDIES REVIEW, Volume 1, 303–316, 2003. Web.

Immervoll, Herwig. Welfare reform in European countries: a micro simulation analysis”, The Economic Journal, Volume 117, Issue 516, pages 1–44, 2007. Web.

Lindbeck, Assar. The political economy of redistribution and the expansion of the public Sector. Stockholm: premium publishers, 1983.

Lindbom, Anders. Swedish Welfare State Lost Its De¢ning Characteristics?” Scandinavian Political Studies, Vol. 24 ^ No. 3, ISSN 0080^6757, 2001. Web.

Ringen, Stein. History of the Welfare State: The Industrial Democracies in Europe, 1880–1980. Oxford: university of oxford, faculty of history, 2003. Web.

Sven, Steinmo. Globalization and Taxation: Challenges to the Swedish Welfare State. Web.

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IvyPanda. (2020, June 2). Unemployment in Sweden: Causes and Solutions. Retrieved from https://ivypanda.com/essays/unemployment-in-sweden-causes-and-solutions/

Work Cited

"Unemployment in Sweden: Causes and Solutions." IvyPanda, 2 June 2020, ivypanda.com/essays/unemployment-in-sweden-causes-and-solutions/.

1. IvyPanda. "Unemployment in Sweden: Causes and Solutions." June 2, 2020. https://ivypanda.com/essays/unemployment-in-sweden-causes-and-solutions/.


IvyPanda. "Unemployment in Sweden: Causes and Solutions." June 2, 2020. https://ivypanda.com/essays/unemployment-in-sweden-causes-and-solutions/.


IvyPanda. 2020. "Unemployment in Sweden: Causes and Solutions." June 2, 2020. https://ivypanda.com/essays/unemployment-in-sweden-causes-and-solutions/.


IvyPanda. (2020) 'Unemployment in Sweden: Causes and Solutions'. 2 June.

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