Southern Sweden to Lead Job Growth as Northern Economy Slows

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Southern Sweden to Lead Job Growth as Northern Economy Slows
Photo: Fredrik Sandberg/TT

The hot economy in northern Norrland is cooling down. It is in southernmost Sweden that the best job growth will occur next year. But the recovery will be felt throughout the country, more or less, says Anna Westlund, economist at Nordea.

The bank is repeatedly releasing a report that makes an assessment of the expected economic development regionally.

The expected economic development, spurred on by tax cuts and lower interest rates, is generally considered brighter next year. But it's going at different speeds.

Households are the key to the recovery, and that benefits the service industries in the main metropolitan areas, says Anna Westlund.

Different starting points

The starting point looks different in the initial situation. Skåne has the highest unemployment in Sweden today, but the prospects are now brighter, among other things as an effect of a expected stronger service industry, and a relatively strong Danish economy that spills over the sound.

Southern Sweden has the strongest employment forecast, along with Stockholm, says Anna Westlund.

The opposite applies to northern Norrland, which, along with Gotland, has the lowest unemployment at present, according to the Employment Service's figures. The past year has seen several setbacks, including the bankruptcy of battery manufacturer Northvolt.

The rest of Norrland, northern Middle Sweden, and Småland have had a weaker development and nothing indicates that it will get any better.

They have no real city region that drives, so the development is a bit weaker, says Westlund.

Weak construction

The demographic development also has an impact.

Population growth is slowing down quite clearly, it affects the regions differently, it affects the growth potential. In northern Norrland, there may be problems with skills supply.

The construction sector is directly affected by the fact that the population is not growing or even decreasing in some areas.

There, we see no real recovery due to the low housing construction, says Anna Westlund.

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By TTEnglish edition by Sweden Herald, adapted for our readers

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