The Swedish labor market had a soft beginning to 2020, as was anticipated. On a seasonally adjusted basis, the jobless rate rose to 7.1 percent from December’s 6.6 percent, as compared with consensus expectations of a rise to 6.9 percent. On a year-on-year basis, unemployment is 1 percentage point higher.
Labor force data continue to be quite volatile. The overall picture is that unemployment remains on the upward trend. The January unemployment reading was as expected, and must be considered to be in line with the Riksbank’s view of 6.9 percent on average for the first quarter of 2020.
Employment dropped 0.4 percent sequentially in January and remained almost the same on a year-on-year basis. Labor supply rose on the month in January.
“Indicators are mixed, but there is currently a healthy momentum in the domestic economy, with rising home prices, higher real incomes and good consumption growth. Thus, demand for labour should be decent going forward and unemployment should level out between 7 and 7.5 percent later this year”, said Nordea Bank in a research report.
