After a long but mild GDP contraction (-4.3% from the peak so far), more cracks appear in the labour market. Employment decreased and unemployment increased, as expected, in the third quarter. Demand for labour has decreased, and the number of vacancies is smaller than usual.
Employment has fallen little so far (-0.4% since the start of the year). Jobs have disappeared mainly in rural areas, in industry and construction. More recent data show that employment declined further in the fourth quarter.
The unemployment rate has increased from 5.3% in the first quarter to 7.3% in the third quarter. Among the unemployed, the largest number are various unskilled workers whose previous job was either in trade, customer service, or construction.
According to Swedbank’s forecast, the unemployment rate will increase only moderately, from 6.8% in 2023 to 7.6% in 2024. Employment will fall slightly next year, by 0.4% in 2024.