Lack of workers in Sweden – what is on the horizon?

Sweden has, along with many other countries around the world, an aging population. In 2030, 25% of the Swedish population will be over 65 years old. While many expect to work longer, we see more and more people go into retirement. 

Along with a high long-term unemployment rate, the official figure is currently 7,2%, which means quite a few people will not be part of the workforce. A heavy burden will be placed on those between 18-64 years that are working to support both the old, young and unemployed. 

The rate of digitization demand software developers, engineers, mathematicians, and other highly skilled persons to develop companies and not least the public sector. However, Swedish universities don’t educate enough people that master these skills quickly enough. 

So what can be done?

The tech industry has a variety of initiatives, to get women to enter the industry, marketing campaigns to get people interested in reskilling, upskilling, or starting education with a tech focus. 

This is a medium-term strategy, it will take a few years for the newly educated to enter the workforce. 

For companies that need these skills here and now, looking for talent outside the Swedish borders is the next step. It’s hard work and an expensive exercise, yet necessary to continue to serve customers and to grow. There are recruitment firms in Sweden that have established talent networks in key markets that can help companies find the skillsets needed. Welcoming talent from outside the EU means going through the immigration process to get a Swedish Work Permit to enter and start working. 

The Swedish government is currently hesitant to solve the skills gap via international recruitment. Companies point at foreign talent as being instrumental to grow and keeping up with competitors in other countries. 

Another option is to move the company to where the talent is. Some companies have done this already, others are considering doing it. There are tech hubs in a variety of countries.  Due to geopolitical upheavals In 2022, we have seen companies have redistributed talent from Russia, Ukraine, and Sri Lanka amongst other countries. Bringing people from satellite offices is a possibility that many do, however it’s necessary to plan ahead given the timelines to get a work permit approved by the Swedish Migration Agency is lengthy these days. 

Many Swedish companies have done enormous efforts to safeguard the safety of remote employees and offer them a safe haven in Sweden. There are discussions about changes in the immigration law, yet again, which may make it even hard to move talent to Sweden in case they need a work permit to relocate. 

Immigration changes on the horizon are; 

1. A salary threshold that is based on the Swedish median salary, depending on how it’s calculated ranges from a minimum of 27500 SEK/month to 35 000 SEK/month. The salary level will prevent approximately 40-50% of the current work permit applicants to be approved.

2. The EU Blue Card will be reviewed in Sweden to harmonize with Swedish immigration law. It’s expected that full medical insurance coverage is signed for before the approval can be given. 

3. The ICT permits, ie Intra-company transfers will be subjected to more scrutiny. Nimmersion immigration experts have always asked to review the insurance letters in the home country to safeguard that it lives up to Swedish standards. However, it seems that many immigration experts don’t look at it and the unions are concerned that the employees are living dangerously. It’s likely that we will see change ahead for these kinds of work permits. 

4. Unions suggest that the certified fast track should be removed and instead a 90-day turnaround should be promised. However, it’s clear that the permits with the fastest time to approval are favored. This is the reason why there were only a few ICTs and EU Blue cards since regular work permits had 10 days. Therefore, it’s clear that the time to approval is very important to the companies and 90 days is considered too long. 

5. The government is concerned by illegal labor, poor employment terms, human trafficking, and salary dumping, hence they want to add even stricter measures of control. The work permit holders in Sweden are 0,2% of the workforce and are the most regulated group In the Swedish labor market. Not only are all job offers qualified by a union to be on par with the collective agreements. Proof of Union approved insurance is required and must be shown when renewing the work permit. In addition, the terms are regulated in the Foreign Aliens Act so these precious talents are protected by several laws. 

6. Dependents are also allowed to work. However, no one checks on their terms. Therefore, it can be expected that the process today of allowing dependents their own work permit unless in special circumstances, may change going forward in order to gain a level of control of the employment terms. 

The cost for companies, Sweden, and individuals when companies can’t find talent is enormous and has been calculated to a staggering 10,8 billion SEK per month in lost revenue.

Foreign talent also contributes greatly to Sweden, to Swedish companies by being innovative and valued colleagues, along with taxpayers that generate 12 billion SEK per year. 

Foreign talent that works in Sweden on work permits is very important to Sweden. Nimmersion and many others are working hard to educate, talk to, and explain to politicians the value of being able to bring talent to our shores. 

While we ate going through a rough patch with new laws, and additional proposed changes, Nimmersion stays optimistic for the future and believes that the incredible contribution that foreign talent adds to Swedish companies, co-workers, and the local society will be acknowledged and appreciated. We are hopeful that the government will look to facilitate and speed up the work permit processes so that more talented people can move to Sweden and get a great welcome!

As always, feel free to contact Nimmersion to discuss your situation. We frequently help companies guide them through the maze of bringing talent to Sweden in a good way.

We will introduce new services to offset the slow handling of work permit applications, educational content and guidance, and more. When companies have permits that are denied, stuck, or just hard to get off the ground we can most certainly help you get unstúck and move forward. 

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