Unemployment rises in Sweden as job market weakens, affecting thousands

At the end of July, nearly 357,000 individuals were registered with the Employment Service, marking an increase of almost 27,000 compared to the same period last year. Consequently, the unemployment rate rose from 6.3% to 6.8% over the year. Eva Samakovlis, the agency’s analysis director, stated that the job market remains weak.

In June, there was a decline in the number of layoffs, but this trend reversed in July, with over 4,900 people facing layoffs, up from around 3,500 in July of the previous year. The manufacturing industry, retail, and construction sectors saw the highest number of layoffs.

Additionally, the number of job vacancies posted on the Employment Service has significantly decreased compared to last year, with just over 64,000 new job listings in July, which is approximately 37,000 fewer than the same time last year. The number of long-term unemployed—those without work for one year or more—also continues to rise, reaching nearly 142,000 in July, an increase of about 5,000 over the year.

According to the government, the unemployment rate is at its highest in a decade, excluding the pandemic period, with expectations that the situation may worsen further. This aligns with the Employment Service’s forecast, which predicts a rise in unemployment this autumn, although a recovery in the job market is anticipated as the economy strengthens. This recovery is expected by the end of the year and into early next year, but it may take time.

The government measures unemployment using labor force surveys, which differ from the Employment Service’s count of registered individuals. Recently, the government reported an unemployment rate of 8.3% for the second quarter, projecting an increase to 8.4% before it begins to decrease, indicating a persistently high level in the following year.