Unemployment on the Rise in Which Swedish Locations?
In a recent report, the National Institute of Economic Research (NIER) has revised its forecast for Sweden's growth in 2025, reducing it from 1 percent to 0.7 percent. This revision is attributed to Swedes' lower than expected consumer spending, which has resulted in a slower growth of household consumption.
The report also highlights a significant increase in unemployment across the country, with the Swedish Public Employment Service reporting 363,000 people as unemployed in Q2 2025, an increase from 344,000 in 2024.
The county of Skåne had the highest number of unemployed people, with 36,300 out of work. This was followed by Uppsala county, where unemployment saw a sharp rise, although the exact number was not specified in the report. On the other hand, Norrbotten had the lowest number of unemployed people, with 10,800 out of work.
However, the biggest rise in unemployment was in Västerbotten, where the number of unemployed people increased from 4,992 in Q2 2024 to 7,417 in Q2 2025. This significant increase is primarily due to extensive layoffs, notices, and bankruptcies in the battery manufacturing industry in that region.
Marcus Löwing, the labor market analyst from the Swedish Public Employment Service, stated in a press release that these events significantly affected the labor market in Västerbotten.
Interestingly, only four counties in Sweden saw a decrease in unemployment: Dalarna, Gotland, Gävleborg, and Norrbotten.
The report also mentions higher interest rates as a factor affecting consumer spending. Moreover, prices in Sweden have risen by 30 percent in the last three years, according to the report.
Despite the current slump, the report predicts that the economy will come out of it in 2026. The NIER also published a report predicting a decline in unemployment from the start of next year. However, Ylva Hedén Westerdahl, the head of forecasting at the NIER, admitted that they have been consistently wrong about household consumption.
It's important to note that the report measures unemployment differently compared to the Swedish Public Employment Service. Therefore, the exact unemployment rates for each county might differ slightly between the two sources.
[1] Supporting details: - The total registered unemployed in Sweden rose from 344,000 in Q2 2024 to 363,000 in Q2 2025, with Västerbotten experiencing the largest increase among counties. - The spike in unemployment there is directly attributed to the impacts within battery manufacturing, including company bankruptcies and workforce reductions. - This contrasts with other counties where unemployment either rose less or even declined during the same period. - No other sector or macroeconomic causes were highlighted in the sources as main drivers for the jump in Västerbotten’s unemployment at that time. Hence, the key cause is the localized distress in the battery manufacturing industry.
- The significant increase in unemployment in Västerbotten, up from 4,992 in Q2 2024 to 7,417 in Q2 2025, is primarily due to the localized distress in the battery manufacturing industry, including company bankruptcies and workforce reductions.
- While the National Institute of Economic Research (NIER) predicts a decline in unemployment from the start of next year, a key political concern in the general-news context is the consistently wrong predictions about household consumption made by them.
