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Hartmann, Sweden

L_General Imolications of Swedish Youth Employment Policies

Looking at the outcome of Swedish macro-economic planning and the inter-yentions of an active labour market policy which tries to avoid overt un-employment by the massive creation of public employment schemes and relief-work, one has to acknowledge that the result has not verified the prophecies of the critics.

While Sweden has avoided mass unemployment, especially among youth, and the creation of the "new poor" with the negative consequences of indi-vidual marginalization and social disturbance, economic growth has been well in linę with other European countries. During 1982 - 1987, inflation has been cut by 50*. the balance of payments has improved from -5.8 bil-lion SEK to +27,0 billion SEK, the budget deficit has been reduced by 70% and the stockmarket is flourishing with a value increase of 350%. (Dagens Industri 87-10-03) Thus, Iow unemployment does not automatically lead to high inflation, as stagflation might occur even in countries with rather high unemployment. Economic growth cannot only be achieyed by rationaliza-tion at the eipense of the work-force, but might be strongly influenced by the agreement of empioyers, unions and politicians on the steps needed to increase production. The transfer of people from industries of Iow economic performance to areas of economic growth is eased by the eiistence of public employment schemes and the active intervention of government in the creation of futurę employment opportunities.

Though Sweden has succeeded in avoiding the most negatiye effects for the individual in cases of structural changes in economy, the transfer of the work-force from traditional parts of economy, e.g. the manufacturing in-dustry, to public services where there is a demand for labour, is hindered by the eiisting structures of unions and empioyers, taiation, the unemployment insurance system and regional imbalances. The acceptance to pay people who are not working unemployment benefits instead of using the potential work-capacity of the unemployed for the demands of labour can only be accomplished to a minor degree by the employment schemes.

The schemes rather allocate the work-force in linę with administratiye preferences within the Labour Market Administration than to allow public agencies to directly hire Staff with the help of the financial means allocated by the Labour Market Administration. While the administratiye system of the Labour Market Board facilitates the central steering and planning of the national economy, it, at the same time, favours a national perspective on the employment situation as reflected in nationwide statistics on employment.