www.oecd.org/eco/surveys/economic-survey-sweden.htm

OECD

OECD Economics

2015 OECD ECONOMIC

SURVEY OF SWEDEN

Growth and skills

Stockholm, 30 March 2015

The economy has been resilient

2

90

95

100

105

110

115

120

125

90

95

100

105

110

115

120

125

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

2005Q1=1002005Q1=100 Real GDP

Sweden Germany United States Euro area Finland Denmark

Source: OECD Economic Outlook database.

Well-being is high

3

0.0

0.2

0.4

0.6

0.8

1.0Income

Jobs and earnings

Housing

Work and life balance

Health status

Education and skillsSocial connections

Civic engagement andgovernance

Environmental quality

Personal security

Subjective well-being

Sweden OECD Nordics

Source: OECD (2013), How’s Life? 2013: Measuring Well-being.

Growth is green

4

0.0

0.5

1.0

1.5

2.0

2.5

0.0

0.5

1.0

1.5

2.0

2.5

CH

E

SW

E

FR

A

NO

R

ES

P

GB

R

AU

T

ITA

PR

T

JPN

DE

U

DN

K

ISR

NLD

LUX

BE

L

GR

C

HU

N

CH

L

SV

N

ME

X

SV

K

IRL

TU

R

US

A

CA

N

CZ

E

KO

R

LTV

PO

L

NZ

L

AU

S

FIN

ES

T

ISL

Tons of CO2 per thousand USD PPP

Tons of CO2 per thousand USD PPP

Source: International Energy Agency, World Energy Statistics and Balances (database).

Greenhouse gas emissions per unit of GDP

Productivity has slowed

5

100

110

120

130

140

150

160

100

110

120

130

140

150

160

1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013

1993=1001993=100

Sweden Finland United States Germany

Real GDP per hour worked

Source: OECD Productivity database.

Unemployment remains relatively high

6

0

2

4

6

8

10

12

14

0

2

4

6

8

10

12

14

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

% of labour force% of labour force

Sweden Germany United States Denmark Finland Euro area

Source: OECD Economic Outlook database.

Unemployment rate

Main Findings

o The economy has been resilient.

o Well-being is high, and growth is greener than in most other OECD

countries.

o Productivity growth has slowed, reflecting cyclical but also structural

factors.

o Sweden has a strong comparative advantage in knowledge-intensive

activities, which needs to be preserved.

o Educational achievements have slipped.

o Young people with low qualifications and immigrants are the most

vulnerable to unemployment.

7

Key Recommendations

Broaden support for innovation and enhance coordination of innovation

and research policies.

Simplify business and land-use planning regulations.

Make teaching more attractive and improve teacher education.

Increase support for struggling students, notably immigrants.

8

Strengthening the foundations

for growth

Sweden is close to the global efficiency frontier

Boosting growth

requires innovation

10

Source: OECD (2015), Economic Policy Reforms 2015: Going for Growth.

80

82

84

86

88

90

92

94

96

98

100

80

82

84

86

88

90

92

94

96

98

100

1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013

%% Output relative to upper half of OECD countries

GDP per capita GDP per hour worked

The current account surplus is high

11

Sweden is well

integrated in global

value chains

Services and

investment income

contribute strongly

to the surplus

Source: OECD Main Economic Indicators.

-6

-4

-2

0

2

4

6

8

10

12

-6

-4

-2

0

2

4

6

8

10

12

1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

% of GDP% of GDP

Transfers + Goods Income + Services Current account

Sweden is an innovation leader

12

Innovation has been

boosting productivity

growth and living

standards

Keeping an edge in

innovation is crucial

Source: European Commission, Innovation Union Scoreboard 2014.

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

TU

R

PO

L

HU

N

GR

C

PR

T

ES

P

ITA

NO

R

ES

T

SV

N

EU

FR

A

ISL

AU

T

IRL

GB

R

BE

L

NLD

LUX

FIN

DE

U

DN

K

SW

E

CH

E

IndexIndex

Modest innovators Moderate innovators Innovation followers Innovation leaders

International competition is becoming tougher,

including in high-productivity sectors

13

Enhance the role of services and SMEs in the

economy.

Broaden support for innovation and enhance

coordination of innovation and research policies.

The recently created Innovation Council can be a key

instrument to achieve these goals.

There is room for improving framework conditions

14

Simplify regulatory procedures

0.0

0.5

1.0

1.5

2.0

2.5

3.0Overall PMR

State involvement in businessoperations

Complexity of regulatoryprocedures

Administrative burdenson start-ups

Regulatory protection ofincumbents

Implicit barriers to trade andinvestment

Sweden OECD Other Nordics Best performer

Source: OECD (2013), Product Market Regulation Database.

R&D expenditure and knowledge-intensive jobs

go together

15

Source: Eurostat.

Business enterprise R&D (BERD) expenditure and skilled employment

AUT

BEL

CZE

DNK

EST

FIN

FRA

DEU

GRC

HUN

ISL IRL

ITA

JPN

NLD

NOR

POL

PRT

SVK

SVN

ESP

SWE

GBR

USA

EU28

0.0

0.5

1.0

1.5

2.0

2.5

3.0

25 30 35 40 45

BE

RD

as

a %

of G

DP

Knowledge-intensive activities as a percentage of total employment

Skills and inclusive growth

High employment keeps inequalities low

17

Wage

compression,

along with taxes

and transfers,

contribute to low

inequalities

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.0

0.1

0.2

0.3

0.4

0.5

0.6

SV

NN

OR

ISL

DN

KC

ZE

FIN

SV

KB

EL

SW

ELU

XN

LDA

UT

CH

EH

UN

DE

UIR

LP

OL

KO

RF

RA

CA

NIT

AE

ST

NZ

LA

US

GR

CJP

NP

RT

ES

PG

BR

ISR

US

AT

UR

ME

XC

HL

IndexIndex

Latest 1990s

Source: OECD Income Distribution and Poverty Database.

Gini coefficient post taxes and transfers

The low-skilled struggle to get a foothold in the

labour market

18

Enhance skills.

Increase flexibility in entry level wages.

Reduce the gap in employment protection

between permanent and temporary contracts.

The fall in PISA results will likely translate into

lower adult skills

19

460

480

500

520

540

560

460

480

500

520

540

560

2003 2006 2009 2012

Average PISA scoreAverage PISA scorePISA results in the Nordics

Sweden Denmark Norway Finland

Source: PISA Databases (2009 and 2012).

The OECD

Survey of Adult

Skills (PIAAC)

also shows

weaker results for

younger cohorts

Performance in compulsory school should be

improved

20

Raise the attractiveness of the teaching profession by:

• Increasing monetary incentives

• Offering better career paths

• Improving teacher education

Consider consolidating some of the institutions that

advise on and supervise education policy into an

education policy council.

Skills vary considerably across educational

attainment

21

Increase support for struggling students, notably immigrants

Target resources based on socio-economic background

2

3

4

5

225

275

325

375

At m

ost l

ower

seco

ndar

y

Upp

er s

econ

dary

-vo

catio

nal

Upp

er s

econ

dary

-ge

nera

l

Pos

t-se

cond

ary

not

tert

iary

Ter

tiary

type

voca

tiona

l

Ter

tiary

aca

dem

ican

d re

sear

ch

PIAAC levelPIAAC score

Range of literacy proficiency among young

adults in Sweden

Source: OECD Survey of Adult Skills (2012).

Sweden receives high humanitarian and family

reunion immigration

Permanent immigration by category of entry2012

22

Source: OECD International Migration Outlook 2014.

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.0

0.1

0.2

0.3

0.4

0.5

0.6

ME

X

JPN

KO

R

GB

R

ES

P

DE

U

DN

K

PR

T

IRL

NLD IT

A

AU

T

FR

A

OE

CD

BE

L

FIN

US

A

CA

N

CH

E

AU

S

NO

R

NZ

L

SW

E

% of total population% of total population

Family Humanitarian

Literacy proficiency is crucial for immigrants to

get jobs

23

Enhance support and incentives for immigrants to learn Swedish

1

2

3

4

5

175

225

275

325

375

For

eign

-bor

n

Nat

ive-

born

For

eign

-bor

n

Nat

ive-

born

For

eign

-bor

n

Nat

ive-

born

Lower than uppersecondary

Upper secondary Tertiary

PIAAC levelPIAAC score

Poorer literacy and higher variation among young immigrants than their native peers

0

10

20

30

40

50

60

70

80

At most lowersecondary

Upper secondary Tertiary education

%

Non-EU young adults are less educated than their native peers

EU Non-EU Native

Source: OECD Survey of Adult Skills (2012).

More Information…

www.oecd.org/eco/surveys/economic-survey-sweden.htm

OECD

OECD Economics

Disclaimers:

The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities. The use of such data by the OECD is without

prejudice to the status of the Golan Heights, East Jerusalem and Israeli settlements in the West Bank under the terms of international law.

This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers

and boundaries and to the name of any territory, city or area.

24