2010-09-02
Light Rain Shower
Now: 13°C
RSS-feed Subscribe via RSS


News

Continuing deindustrialization in Sweden during the 2000:s

Chronicles/analysis | 2009-12-29 | 1 comment
In the last months of 2009 it has been evident that a major part of the Swedish engineering industry is about to disappear from Sweden. For such a small country like Sweden, it has been extraordinary to have two major car producers, Saab and Volvo. But from what it seems, Saab will be out of business if no miracle occurs. Volvo, on the other hand, will most likely be sold to the Chinese car producer Geely. Volvos future inside Geely is therefore pretty safe in the short run, but certainly not in the long run.

Including suppliers the Swedish car industry employed 140,000 people in 2008. Although some parts of the industry, for example the heavier vehicles, are expected to survive, a significant proportion of these jobs are already lost or in great danger. This is however no isolated Swedish experience. The crisis has affected European and Asian automobile manufacturers, but it is primarily felt in the American automobile manufacturing industry. So there is a global crisis in the automotive industry and small manufactures without profits or financial support are now restructuring or collapsing world wide.

These happenings have been high lightened by Swedish media and the implications have been in focus for much of the year 2009. The more long term decline in the industrial base of Sweden is more seldom discussed, but has also far going consequences. The phenomenon is deindustrialization and it is used to describe the decline of manufacturing in several countries and the flight of jobs. The industrial society may have been at its height in the 1960:s in Sweden when more than 1,2 million Swedes were employed there or around 40 percent of the work force.

Many villages in Sweden relied by then heavily on one industry or even one company. In these industrial towns or villages people earned their daily bread at the factory, they socialized with their working mates also in their spare time and many welfare utilities were handled by the company. So, the industrial society was more than a place to work. As late as in the mid 1970:s 1,1 million were still employed in manufacturing, but for each decade this sector has lost more than 100.000 jobs. The latest SCB-statistics from 2008 (before the automotive industry crashed) showed that less than 700.000 were employed in manufacturing which is less than 20 percent of the work force in Sweden. Even if statistics are a bit uncertain it is obvious that this cannot more than partly be explained with classification errors.

The magnitude of the change at the Swedish labour market is obvious. But on the other hand, the increasing levels of production output in the manufacturing sector are a clear indication that the deindustrialization is based on the decrease in employment. Instead the service sector is on the rise in Sweden as in many other Western countries. In Sweden the growth of the public sector, mainly health and education, expanded rapidly in the 1970:s and 1980:s and thereafter private services in for example finance, personal services and transportation. The consequences of this process away from manufacturing jobs towards a service economy are of course difficult to estimate. The implications in politics, economics and others areas in society are however already taking place.

Henrik Lindberg,  researcher at  The Ratio Institute

henrik.lindberg@ratio.se

       Print Print article

Readers' comments

2010-03-20 17:32 Laxmi Narayan Naik wrote:
Very thought-provoking and well-researched article..


Write a comment

All comments are reviewed by the moderator before they are posted. Only comments in English written in a respectable tone will be published.
Read a full description of our policy for comments.



Name:
  

Latest headlines



Question

Sweden recently decided to start taking admission fees for non-EU students starting in the fall semester 2011. What do you think of this?
News in short
TODAY
2010-09-01
2010-08-31
2010-08-30
2010-08-28

More...
Reader's comment
Stockholm Calendar
Sep 3
Sep 5 - Sep 11
Sep 7
Sep 12
Sep 16
Sep 17
Sep 19
Sep 22
Oct 8 - Oct 9
Oct 20 - Oct 22
Oct 27
Oct 29 - Oct 30
Nov 13 - Nov 14
Nov 26 - Nov 28