Structural reforms and macro-economic policy - ETUC

Structural reforms and macro-economic policy
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LABOUR MARKET REFORMS:
A PERSPECTIVE FORM SWEDEN
The Swedish economy is an open economy and has
traditionally been heavily dependent on foreign trade
of goods and services. To benefit from foreign trade, it
is necessary to face changes in production patterns.
Trade unions have been rather positive to structural
change – as long as lost jobs have been replaced by
new jobs at higher wages.
A corner stone in the Swedish model is the system of
general social benefits. Benefits are at a relatively
high level of compensation and can be supplemented
by collective agreements.
Since 1938, the social partners have had a tradition of
co-operating without intervention from the government.
Many issues have been solved through voluntary
agreements instead of through legislation,
including how to increase and cut the work force.
Traditionally, a high percentage of the working population
in Sweden belongs to trade unions, today it is
about 80 per cent.
During the 1950´s the Swedish model developed with
the characteristics of collective and central wage
bargaining, full employment and a wage policy based
1 International Secretary, SACO-Sweden
Employment Policy Brief No 5, Brussels: ETUI-REHS.
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Strategies, Brussels: P.I.E.-Peter Lang, 173-215.
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Method of Co-ordination in Action. The European
Employment and Social Inclusion Strategies,
Brussels: P.I.E.-Peter Lang.
Åke Zettermark 1
on solidarity. This wage policy meant that companies,
independent of their ability to pay for wage increases,
had to pay the same wage for the same type of job.
That fuelled structural change as less profitable firms
closed down and the more profitable expanded their
work force. The Public Employment Service received
resources to support the redundant workers with
relocation costs and training for their new jobs at
expanding firms or elsewhere.
I would claim that the focus on security for the individual
is to make him or her employable – not to focus
on keeping the job in question. The flexibility is a
responsibility of the social partners while security is a
joint responsibility of the government and the
partners. During the 1970´s one might argue that
security was more emphasized. We got several new
laws on security for the workers. One of the most
debated laws was, and still is, the Employment
Protection Act (LAS) with the “last hired, first fired”principle.
People became more reluctant to move to a new job
because they would lose their seniority protection –
and also because they would have to find two new