Spring/Summer 2024 Sweden Labour Market Analysis: Exploring the Evolving Workforce

As we move into Q2 2024, skills shortages, ongoing workforce legislation and a resilient Swedish labor market represent a mix of challenges and opportunities. The growth of external labour – and with it the need for additional visibility into the costs and management of this talent – presents additional complexities.

Our comprehensive "Spring/Summer 2024 Europe Labour Market Report” explores some of the dynamics currently shaping the Swedish market. Here’s a high-level look at the landscape:

Macro Environment

In 2023, the Swedish labour market displayed intricate nuances, shaped by the COVID-19 pandemic aftermath and a resilient rebound in household and construction sectors. The tech industry, pivotal to Sweden’s economy, faced initial challenges with layoffs and bankruptcies among smaller start-ups, but saw a noteworthy revenue increase toward the latter part of 2023.

Despite the hurdles, there was a steadfast commitment to technological advancements, notably in AI. Companies displayed an appetite for integrating AI into their operational processes, such as optimising fulfilment centres and predicting staffing needs. Looking forward to 2024 and 2025, there is cautious optimism within the industry, with expectations of a gradual shift toward more favourable conditions.

The labour market saw a rise in unemployment rate in 2023, reaching 7.7%, with 72,500 people notified of dismissal, more than double the previous year. This surge highlights the challenges faced by certain sectors, such as construction.

Skills in Demand

In 2023, companies experienced a significant shortage of skilled professionals in Sweden, particularly in healthcare and technology. Efforts are needed to enhance training programs and attract talent in these critical sectors. Other notable trends include:

• A challenging recruitment landscape for consulting companies, with reduced turnover and a 24% drop in requisitions
  
• A 30% decrease in demand for roles in transportation, telecom, retail, real estate, logistics, IT, industrial, and finance, primarily impacting the private sector
• An uptick in requisitions in the energy and cybersecurity/defense sectors, reflecting a shift in talent needs, likely influenced by ongoing conflicts worldwide

Efforts to bridge the gap between education and industry needs involve fostering closer connections between universities and companies, facilitating smoother transitions for graduates. Government funding is also increasing to address potential understaffing over the next 10 to 15 years, especially in the IT sector. However, geographic constraints on remote hiring present challenges.

Other Trends

Wage growth in Sweden during 2023 deviated from the norm, with percentages ranging from 3.5% to 7% and the larger increases attributed to the influence of higher prices. New hires may see more modest increases to maintain salary balance in 2024, with the preceding recession continuing to impact salary dynamics.

The hybrid work model, offering a balance between physical presence and remote work, is popular. However, some companies have opted for full onsite or full remote setups, compensating remote workers on par with office-based counterparts.

Get the Full Report

Our new “Spring/Summer 2024 Europe Labour Market Report” also includes bill rates for key job titles in Sweden, as well as exploration of high-level trends across Europe. Beyond this broader analysis, we also dig deeper into the economic landscape in the UK, Ireland, Germany, the Netherlands and Switzerland. For much more, download the report now.

Disclaimer: The content in this blog post is for informational purposes only and cannot be construed as specific legal advice or as a substitute for legal advice. The blog post reflects the opinion of Magnit and is not to be construed as legal solutions and positions. Contact an attorney for specific advice and guidance for specific issues or questions.