Response to interpellation 2024/25:6 on measures in view of rising unemployment
Translated from Swedish by AI; the translation may contain errors. The Swedish text is the original.
Summary AI, written in advance
L proposes a new job tax credit and investments in education as well as reinforced support for job seekers with large support needs 1. L emphasizes that high-quality education is the most important measure for establishing oneself on the labor market and makes a historic investment in vocational colleges 1 2 3. L argues that the low growth is due to high interest rates and variable loans 2, and that fighting inflation is necessary to be able to lower interest rates later 2 3. L considers that Sweden has high employment and that skills shortages are a problem that education investments should solve 2. L believes that taxes should be lowered for those who work and facilitate for the construction industry through, for example, an increased rot deduction.
Written by AI in advance and may contain errors. The numbers lead to the speech a statement builds on; check against the text below.
Arbetsmarknads- och integrationsministern Mats Persson (L)
Mr. Speaker! Teresa Carvalho has asked what new initiatives I intend to take within my area of responsibility to reduce unemployment.
The government has taken a number of measures and is focused on pushing back unemployment. The most important measure has been to prioritize the fight against inflation through a restrained fiscal policy. Now the fight against inflation is won, and it is time to invest.
To meet the high unemployment, the government has submitted proposals in the autumn budget regarding reduced taxes on labor and investments in education and support for persons far from the labor market.
The government proposes a new job tax credit for ordinary people. It should always pay to work, and many households have been pressed hard by high costs. But it is not enough to just lower the tax on work.
Many unemployed people are far from the labor market. Therefore, a reinforcement of Arbetsförmedlingen's own support to job seekers with great support needs is proposed. In the budget bill for 2025, an addition of 79 million kronor to Arbetsförmedlingen is proposed. The Government estimates that 158 million kronor will be added to the operation for 2026 and 238 million kronor from and including 2027.
The most important individual contribution to establishing oneself on the labor market in the long term is education. High-quality education strengthens individuals' opportunities to establish themselves on the labor market and makes it possible to take advantage of everyone's competence.
The investments made in more places within both the university colleges and the vocational adult education improve access to education, so that more people can quickly enter the workforce. In the budget bill for 2025, the government proposes a supplement of 900 million kronor, including student grants, for approximately 11,000 new training places within regional vocational adult education in komvux. Additionally, the grant for mentors in lärlingsvux is doubled.
The Government also proposes in the budget bill for 2025 an investment of 32 million kronor on increased information exchange between Arbetsförmedlingen and the municipalities. An improved information exchange can contribute to more unemployed people being able to participate in education within komvux that they need to enter employment. It also provides better conditions for individualized support. Arbetsförmedlingen simultaneously receives tools to follow up that the job seekers follow the authority's instructions and to verify their entitlement to compensation. The occurrence of incorrect payments is thus assessed to decrease.
Everyone who can work shall do so. High requirements shall be placed on those who seek jobs combined with that unemployed are offered the right support and measures. Furthermore, there shall also be clear activity requirements for receiving benefits.
Arbetsförmedlingen has received a continued mandate in this year's regulatory letter to increase geographical and professional mobility among the unemployed. Those who are without work must be prepared to undertake an education, retrain, or seek a job in another municipality.
Teresa Carvalho (S)
Mr. Speaker! I would like to begin by welcoming Mats Persson to what, if I am not mistaken, is his first interpellations debate in his capacity as Minister for Employment - his first of many, I dare say.
Mr. Speaker! It is halfway through the parliamentary term. The government describes that it is brightening on the horizon. I truly understand that one would like it to be so. But I believe few Swedes recognize themselves in that description.
Let us look at the first half of the parliamentary term! During this time, the government has created a healthcare crisis that persists. They have failed to stop the new recruitment to the gangs, even though the violence is creeping down to younger ages. They have made ordinary families poorer. They have let construction plummet. Through that, they have damaged Sweden's growth. As if this were not enough, they are now also burning billions on tax cuts for the very richest and sending the bill to ordinary people.
This policy has also contributed to rising unemployment. We now have the highest unemployment in ten years, obviously with the exception of the very special pandemic years. Despite this, the development has been met with almost a sniff from the government. At the same time as unemployment has risen, the government has cut massively on job initiatives - we are talking about billions.
Mats Persson is very happy to talk about tax cuts as a response to rising unemployment - as if the big problem for ordinary people who are out of work is that they do not think it pays off enough to come to work. I am quite sure that Mats Persson will come out with his usual platitudes about restoring the work line and that we Social Democrats, in contrast to the government, would stand for some kind of benefit line. I have heard Mats Persson argue in that way before. But it is, of course, nonsense. It is a silly attempt to try to portray the Social Democrats, the workers' party, as a party that does not understand the value of hard work.
We are one hundred percent in agreement that everyone who can work should work and that it should pay to work. Anything else would, of course, be completely absurd. On the other hand, we do not agree with the government's belief that enormous tax cuts for the richest lead to lower unemployment. It is possible that Mats Persson now feels motivated to put in a little extra effort in his new job since he is going to receive a tax cut of several thousand kronor a month next year. But it is not everyone who will receive that, and I do not believe either that lower taxes are what makes people move from unemployment or sickness to work.
What would have made a real difference here and now is more money for construction stimuli and for healthcare, so that the construction workers I met last week and the nursing assistants who were notified of their dismissal this week would have avoided being laid off. In the longer perspective, investments were also obviously needed instead of cuts to measures for those who stand without education and work experience.
I wonder, Mats Persson, how the Minister feels it has gone for the government's so-called work line when the result is fewer hours worked in the economy, lower growth and higher unemployment.
Arbetsmarknads- och integrationsministern Mats Persson (L)
Mr. Speaker! Thanks to Teresa Carvalho for this first interpellation, which will probably not be the last! There will surely be more.
I find it interesting to listen to the member, because one gets the impression that the Social Democrats are located somewhere other than where most people in Sweden are located.
We have had and continue to have a prolonged recession in Europe, and also in Sweden. We have had an inflation crisis, where we, after Putin's horrific invasion of Ukraine, have seen how prices and inflation have worsened the living situation for ordinary people in a shocking way. It has forced central banks around the world to raise interest rates very significantly, which means that the margins for many Swedes have been affected to a high degree.
Mr. Speaker! This is naturally noticeable when it comes to what consumption space people have. As a consequence of that, we see that certain industries that require consumers to have a lot of money, such as the construction site, trade and restaurant, are having a very tough time. The labor market there has been and is tough and serious.
To this is added a global situation where the German economy is performing weakly, which naturally affects the Swedish manufacturing industry. This means that many workers and officials within the industry have tangibly much less to do. They may not have lost their jobs, as the companies want to retain their staff, but one sees how there are fewer and fewer orders from other countries. This naturally affects Sweden as a small, open economy. It affects how much work there is in the economy, and it affects both employment and unemployment.
Mr. Speaker! It must be remembered that Sweden has among the highest employment rates in Europe. We should be proud that women work, and we should be proud that many of those born abroad who have come to Sweden and who find it tough to enter the labor market and get a job, nevertheless seek work or stand available to the labor market.
Despite the fact that it is a recession, there are many employers who are searching with a lantern for competent labor. But we have a problem with the fact that the competence of the employees does not fully match what the employers are seeking and demanding.
In light of this, the government chooses to make large investments in education, not least when it comes to vocational training that leads to real jobs. We are making a historic investment in vocational training within the framework of what is called the university college (yrkeshögskolan), where nine out of ten get jobs. One studies a program for half a year, a year, one and a half, or two years in most cases, and after that, one can usually start working at a workplace. It is an investment we make because we want to do something about the shortage of competence that many employers experience.
This is the largest investment ever in the vocational college, which we are making in light of the fact that we need more people who can take the vacant jobs that exist.
Teresa Carvalho (S)
Mr. Speaker! I hear the new Minister for Employment take his starting point in the economic downturn. He almost makes it sound as if Sweden is not more severely affected than other countries. Let us take a look across Europe. Then it appears quite soon to be rather bad for the Swedish government's part, for the truth is that Sweden is one of the countries that has the lowest growth in all of Europe.
What we are now seeing with the record-high unemployment is that it is, not entirely but partially, caused by the government's failed growth policy. It is the government itself that has pushed forward a policy in this direction.
I find it remarkable to hear Mats Persson describe the fight against inflation in such an interesting way. It almost sounds as if the Minister for Employment means that it has been a deliberate strategy from the government's side to keep unemployment up in order to combat inflation. In what way would it have been more inflation-driving to invest in healthcare and housing construction, which we Social Democrats have wanted to do to take Sweden out of the crisis, than to invest billions of kronor on tax cuts and luxury renovations for high-income earners, which the government has instead prioritized?
I would very much like to hear Mats Persson elaborate on whether it has been a deliberate strategy from the government's side to keep unemployment high in order to combat inflation.
Let me also remind the Minister for Employment that he is no longer the Minister for Education. I naturally understand that these things are connected, but I can also take the opportunity to remind that during Mats Persson's time as Minister for Education, the government also made quite large cuts on the education side.
It almost sounds like Mats Persson is saying that this government has only moved money between the items. It sounds like education policy is part of labor market policy and that it therefore does not matter so much where the money is. But if we combine the budget items for education policy and labor market policy, we see that the government has cut massively. The government and Mats Persson need to take responsibility for that.
That one has now come to the realization that it perhaps was not so incredibly smart to cut back on, for example, adult education does not save the government from old sins, so to speak. It is very good if one now invests in adult education, but it has been a lost parliamentary term.
I can also take the opportunity to remind that the government has announced that it intends to abolish the study start support, which is the tool that Arbetsförmedlingen has in its toolbox to get people who are short-educated to take the step into regular education. If one argues in the way that the Minister for Employment makes and says that one wants to place a greater focus on education policy within the framework of labor market policy - which I think is reasonable in many ways - it becomes completely incomprehensible that the government is now acting in this way.
Arbetsmarknads- och integrationsministern Mats Persson (L)
Mr. Speaker! Teresa Carvalho asks a very relevant question: How can one explain that the growth in Sweden during recent years has been somewhat lower than it has been in our global environment?
To be honest, there are two explanations, at least according to the economists. One is that Sweden had a somewhat higher growth during the pandemic because we did not shut down, unlike our neighboring countries Finland and Denmark. We therefore had a better economic situation than they did, with higher growth and higher GDP. When they then opened up their countries from a standstill, their economies gained more momentum than the Swedish one.
The second – and this perhaps is the main reason – is that very many Swedes have variable-rate loans on their homes, in contrast to how it is in our Nordic neighboring countries and, not least, on the continent. This naturally means that when the interest rate for an ordinary household increases from 1.5 percent to 4.5 percent, that is to say an increase of several hundred percent, it is felt in the wallet. It makes it so that one needs to buy exactly what Ica or Coop has on promotion just this week. That is what one buys, and one cuts back on one's consumption. One does not buy clothes as before. One makes absolutely no investments in the house or the apartment because one has a very tight economy.
Naturally, this is reflected in demand and thus in the economy. It is no coincidence that the industries that are currently having a very tough time - and that also explains the fall in GDP - are precisely those industries that need consumers who can consume.
Mr. Speaker! It is against the background of precisely that analysis that the government has chosen to have inflation fighting as the focus for economic policy. It is only when we get down the inflation that we can get down the interest rates, and it is only then that consumption can pick up.
The interaction that has occurred between fiscal policy and monetary policy has been very important precisely in order not to "overheat" the economy, but instead to create the conditions for it to turn around now. It is also for that reason we can see that things are brightening on the horizon, even if it lies further ahead.
Mr. Speaker! Education is important for this government. We believe that people grow when they get to learn. We believe that one grows when one gets to learn Swedish in an SFI classroom. We believe that one grows when one gets to learn at work. We believe that there is very much to be gained by utilizing the power and the commitment that many, not least private companies, have to employ people.
That is why the government is making the largest investment ever in vocational training in the university college. We know that nine out of ten get jobs, and we know that it also ensures that the business sector finds the competence it so much needs.
Teresa Carvalho (S)
Mr. Speaker! When the Liberals entered the Ministry of Employment after the election, unemployment was declining. Now half of the parliamentary term has passed, and I can state that unemployment has risen and settled at the highest level in ten years, with the exception of the pandemic.
What is the government doing then? Well, they are lowering taxes by 27 billion and sending the bill to ordinary people to reward the already wealthiest. Almost half of the reform space goes to this. 79 billion is what they invest in labor market policy. That corresponds to only 1 per mille. So skewed are the government's priorities in a time when unemployment is a much greater problem than it has been in a very long time and where it is going in the wrong direction. But Mats Persson seems quite satisfied.
Arbetsmarknads- och integrationsministern Mats Persson (L)
Mr. Speaker! I must admit that I am somewhat surprised by the rhetoric and very surprised by the Social Democrats' actions. When the government presents proposals to facilitate the construction industry, for example through an increased tax deduction, the Social Democrats vote no to it. When the government presents proposals to make it more profitable to work and wants to give tax cuts to all people in Sweden who work, the Social Democrats vote no to it.
The Social Democrats' budget makes it more profitable to live on benefits than to work. That is where they direct their support. The consequence is that if the Social Democrats' budget had won, it would pay more to live on benefits than to work, compared to the government's policy and the government's budget.
The conflict is very clear: on one hand, the work line, which the government and the Liberals stand for, and on the other hand, the benefit line, which the Social Democrats stand for with full force and great commitment at every opportunity.
Why do the Social Democrats vote no when we want to lower taxes for people who work? It is about people who get up early, go to work and struggle at work when they could stay in bed and call in sick or quit and instead live on benefits. Then we say: It should pay to work. We lower the tax for you who get up in the morning and get yourself to work. The Social Democrats vote no to that. When we want to facilitate for the construction sector, the Social Democrats vote no to that. The rhetoric is not met with action in the chamber and in reality. It is astonishing.
Source: The Swedish Parliament. The speeches come from the open data of the Riksdag, translated into English by AI, which may contain errors.