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Monday, March 23, 2020

Social marketing

From Wikipedia, the free encyclopedia

Social marketing has the primary goal of achieving "social good". Traditional commercial marketing aims are primarily financial, though they can have positive social effects as well. In the context of public health, social marketing would promote general health, raise awareness and induce changes in behaviour. Social marketing has been a large industry for some time now and was originally done with newspapers and billboards, but similar to commercial marketing has adapted to the modern world. The most common use of social marketing in today's society is through social media. However, to see social marketing as only the use of standard commercial marketing practices to achieve non-commercial goals is an oversimplified view.

Social marketing seeks to develop and integrate marketing concepts with other approaches to social change. Social marketing aims to influence behaviors that benefit individuals and communities for the greater social good. The goal is to deliver competition-sensitive and segmented social change programs that are effective, efficient, equitable and sustainable.

Increasingly, social marketing is described as having "two parents." The "social parent" uses social science and social policy approaches. The "marketing parent" uses commercial and public sector marketing approaches. Recent years have also witnessed a broader focus. Social marketing now goes beyond influencing individual behaviour. It promotes socio-cultural and structural change relevant to social issues. Consequently, social marketing scholars are beginning to advocate for a broader definition of social marketing: "social marketing is the application of marketing principles to enable individual and collective ideas and actions in the pursuit of effective, efficient, equitable, fair and sustained social transformation". The new emphasis gives equal weight to the effects (efficiency and effectiveness) and the process (equity, fairness and sustainability) of social marketing programs. Together with a new social marketing definition that focuses on social transformation, there is also an argument that "a systems approach is needed if social marketing is to address the increasingly complex and dynamic social issues facing contemporary societies"

Applications

The first documented evidence of the deliberate use of marketing to address a social issue comes from a 1963 reproductive health program led by K. T. Chandy at the Indian Institute of Management in Calcutta, India. Chandy and colleagues proposed, and subsequently implemented, a national family planning program with high quality, government brand condoms distributed and sold throughout the country at low cost. The program included an integrated consumer marketing campaign run with active point of sale promotion. Retailers were trained to sell the product aggressively, and a new organization was created to implement the program. In developing countries, the use of social marketing expanded to HIV prevention, control of childhood diarrhea (through the use of oral re-hydration therapies), malaria control and treatment, point-of-use water treatment, on-site sanitation methods and the provision of basic health services.

Health promotion campaigns began applying social marketing in practice in the 1980s. In the United States, The National High Blood Pressure Education Program and the community heart disease prevention studies in Pawtucket, Rhode Island and at Stanford University demonstrated the effectiveness of the approach to address population-based risk factor behaviour change. Notable early developments also took place in Australia. These included the Victoria Cancer Council developing its anti-tobacco campaign "Quit" (1988) and "SunSmart" (1988), its campaign against skin cancer which had the slogan "Slip! Slop! Slap!"

Since the 1980s, the field has rapidly expanded around the world to include active living communities, disaster preparedness and response, ecosystem and species conservation, environmental issues, development of volunteer or indigenous workforces, financial literacy, global threats of antibiotic resistance, government corruption, improving the quality of health care, injury prevention, landowner education, marine conservation and ocean sustainability, patient-centered health care, reducing health disparities, sustainable consumption, transportation demand management, water treatment and sanitation systems and youth gambling problems, among other social needs.

On a wider front, by 2007, government in the United Kingdom announced the development of its first social marketing strategy for all aspects of health. In 2010, the US national health objectives included increasing the number of state health departments that report using social marketing in health promotion and disease prevention programs and increasing the number of schools of public health that offer courses and workforce development activities in social marketing.

Two other public health applications include the CDC's CDCynergy training and software application and SMART (Social Marketing and Assessment Response Tool) in the U.S.

Social marketing theory and practice has been progressed in several countries such as the US, Canada, Australia, New Zealand and the UK, and in the latter a number of key government policy papers have adopted a strategic social marketing approach. Publications such as "Choosing Health" in 2004, "It's our health!" in 2006 and "Health Challenge England" in 2006, represent steps to achieve a strategic and operational use of social marketing. In India, AIDS controlling programs are largely using social marketing and social workers are largely working for it. Most of the social workers are professionally trained for this task.

A variation of social marketing has emerged as a systematic way to foster more sustainable behavior. Referred to as community-based social marketing (CBSM) by Canadian environmental psychologist Doug McKenzie-Mohr, CBSM strives to change the behavior of communities to reduce their impact on the environment. Realizing that simply providing information is usually not sufficient to initiate behavior change, CBSM uses tools and findings from social psychology to discover the perceived barriers to behavior change and ways of overcoming these barriers. Among the tools and techniques used by CBSM are focus groups and surveys (to discover barriers) and commitments, prompts, social norms, social diffusion, feedback and incentives (to change behavior). The tools of CBSM have been used to foster sustainable behavior in many areas, including energy conservation, environmental regulation, recycling, and litter cleanup.

In recent years, the concept of strategic social marketing has emerged, which identifies that social change requires action at the individual, community, socio-cultural, political and environmental level, and that social marketing can and should influence policy, strategy and operational tactics to achieve pro-social outcomes.

Other social marketing can be aimed at products deemed, at least by proponents, as socially unacceptable. One of the most notable is People for the Ethical Treatment of Animals (PETA) which for many years has waged social marketing campaigns against the use of natural fur products. The campaigns' efficacy has been subject to dispute.

Not all social marketing campaigns are effective everywhere. For example, anti-smoking campaigns such as World No Tobacco Day while being successful (in concert with government tobacco controls) in curbing the demand for tobacco products in North America and in parts of Europe, have been less effective in other parts of the world such as China, India and Russia.

Social marketing uses the benefits of doing social good to secure and maintain customer engagement. In social marketing the distinguishing feature is therefore its "primary focus on social good, and it is not a secondary outcome.  Not all public sector and not-for-profit marketing is social marketing. 

Public sector bodies can use standard marketing approaches to improve the promotion of their relevant services and organizational aims. This can be very important but should not be confused with social marketing where the focus is on achieving specific behavioral goals with specific audiences in relation to topics relevant to social good (e.g., health, sustainability, recycling, etc.). For example, a 3-month marketing campaign to encourage people to get an H1N1 vaccine is more tactical in nature and should not be considered social marketing. A campaign that promotes and reminds people to get regular check-ups and all of their vaccinations when they're supposed to encourage a long-term behavior change that benefits society. It can, therefore, be considered social marketing.

Social marketing can be confused with commercial marketing. A commercial marketer may only seek to influence a buyer to purchase a product. Social marketers have more difficult goals. They want to make potentially difficult and long-term behavior changes in target populations, which may or may not involve purchasing a product. For example, reducing cigarette smoking or encouraging the use of condoms have difficult challenges to overcome that go beyond purchasing decisions. 

Social marketing is sometimes seen as being restricted to a client base of non-profit organizations, health services groups, the government agency. However, the goal of inducing social change is not restricted to this narrow spectrum of organizations. Corporations, for example, can be clients. Public relations or social responsibility departments may champion social causes such as funding for the arts, which would involve social marketing.

Social marketing should not be confused with the societal marketing concept which was a forerunner of sustainable marketing in integrating issues of social responsibility into commercial marketing strategies. In contrast to that, social marketing uses commercial marketing theories, tools, and techniques to social issues.

Social marketing applies a "customer-oriented" approach and uses the concepts and tools used by commercial marketers in pursuit of social goals like anti-smoking campaigns or fundraising for NGOs.

Social marketers must create a competitive advantage by constantly adapting to and instigating change. With climate change in mind, adaptations to market changes are likely to be more successful if actions are guided by knowledge of the forces shaping market behaviors and insights that enable the development of sustainable competitive advantages.

Confusion

In 2006, Jupitermedia announced its "Social Marketing" service, with which it aims to enable website owners to profit from social media. Despite protests from the social marketing communities over the perceived hijacking of the term, Jupiter stuck with the name. However, Jupiter's approach is more correctly (and commonly) referred to as social media optimization.

History

Many scholars ascribe the beginning of the field of social marketing to an article published by G.D. Wiebe in the Winter 1951-1952 edition of Public Opinion Quarterly. In it, Wiebe posed a rhetorical question: "Why can’t you sell brotherhood and rational thinking like you can sell soap?” He then went on to discuss what he saw as the challenges of attempting to sell a social good as if it were a commodity, thus identifying social marketing (though he did not label it as such) as a discipline unique from c mmodity marketing. Yet, Wilkie & Moore (2003) note that the marketing discipline has been involved with questions about the intersection of marketing and society since its earliest days as a discipline.

A decade later, organizations such as the KfW Entwicklungsbank in Germany, the Canadian International Development Agency, the Ministry for Foreign Affairs in The Netherlands, UK Department for International Development, US Agency for International Development, World Health Organization and the World Bank began sponsoring social marketing interventions to improve family planning and achieve other social goals in Africa, Sri Lanka, and elsewhere.

The next milestone in the evolution of social marketing was the publication of "Social Marketing: An Approach to Planned Social Change" in the Journal of Marketing by Philip Kotler and Gerald Zaltman. Kotler and Zaltman coined the term 'social marketing' and defined it as "the design, implementation, and control of programs calculated to influence the acceptability of social ideas and involving considerations of product planning, pricing, communication, distribution, and marketing research." They conclude that "social marketing appears to represent a bridging mechanism which links the behavior scientist's knowledge of human behavior with the socially useful implementation of what that knowledge allows." 

Craig Lefebvre and June Flora introduced social marketing to the public health community in 1988, where it has been most widely used and explored. They noted that there was a need for "large scale, broad-based, behavior change focused programs" to improve public health (the community wide prevention of cardiovascular diseases in their respective projects) and outlined eight essential components of social marketing that still hold today:
  1. A consumer orientation to realize organizational (social) goals
  2. An emphasis on the voluntary exchanges of goods and services between providers and consumers
  3. Research in audience analysis and segmentation strategies
  4. The use of formative research in product and message design and the pretesting of these materials
  5. An analysis of distribution (or communication) channels
  6. Use of the marketing mix—using and blending product, price, place and promotion characteristics in intervention planning and implementation
  7. A process tracking system with both integrative and control functions
  8. A management process that involves problem analysis, planning, implementation and feedback functions
Speaking of what they termed "social change campaigns", Kotler and Ned Roberto introduced the subject by writing, "A social change campaign is an organized effort conducted by one group (the change agent) which attempts to persuade others (the target adopters) to accept, modify, or abandon certain ideas, attitudes, practices or behavior." Their 1989 text was updated in 2002 by Philip Kotler, Ned Roberto and Nancy Lee. In 2005, University of Stirling was the first university to open a dedicated research institute to Social Marketing, while in 2007, Middlesex University became the first university to offer a specialized postgraduate programme in Health & Social Marketing.

In recent years there has been an important development to distinguish between "strategic social marketing" and "operational social marketing".

Much of the literature and case examples focus on operational social marketing, using it to achieve specific behavioral goals in relation to different audiences and topics. However, there has been increasing efforts to ensure social marketing goes "upstream" and is used much more strategically to inform policy formulation and strategy development. Here the focus is less on specific audience and topic work but uses strong customer understanding and insight to inform and guide effective policy and strategy development. Social marketing in most cases stands in contrast to business marketing and serves for society wellbeing. The techniques of this marketing are used for change of attitudes and behaviours of different audiences in public life.

Social marketing is also being explored as a method for social innovation, a framework to increase the adoption of evidence-based practices among professionals and organizations, and as a core skill for public sector managers and social entrepreneurs. It is being viewed as an approach to design more effective, efficient, equitable and sustainable approaches to enhance social well-being that extends beyond individual behavior change to include creating positive shifts in social networks and social norms, businesses, markets and public policy.

Many examples exist of social marketing research, with over 120 papers compiled in a six volume set. For example, research now shows ways to reduce the intentions of people to binge drink or engage in dangerous driving. Martin, Lee, Weeks and Kaya (2013) suggests that understanding consumer personality and how people view others is important. People were shown ads talking of the harmful effects of binge drinking. People who valued close friends as a sense of who they are were less likely to want to binge drink after seeing an ad featuring them and a close friend. People who were loners or who did not see close friends important to their sense of who they were reacted better to ads featuring an individual. A similar pattern was shown for ads showing a person driving at dangerous speeds. This suggests ads showing potential harm to citizens from binge drinking or dangerous driving are less effective than ads highlighting a person's close friends.

Economy of Sweden

From Wikipedia, the free encyclopedia
 
Economy of Sweden
Kistacentralparts Publish.jpg
CurrencySwedish krona (SEK, kr)
Calendar year
Trade organisations
EU, WTO, OECD and others
Country group
Statistics
PopulationIncrease 10,230,185 (1 January 2019)
GDP
  • Decrease $528.929 billion (nominal, 2019 est.)
  • Increase $563.882 billion (PPP, 2019 est.)
GDP rank
GDP growth
  • 2.4% (2017) 2.3% (2018)
  • 0.9% (2019e) 1.5% (2020e)
GDP per capita
  • Decrease $51,242 (nominal, 2019 est.)
  • Increase $54,628 (PPP, 2019 est.)
GDP per capita rank
GDP by sector
  • agriculture: 1.8%
  • industry: 27.4%
  • services: 70.8%
  • (2012 est.)
  • 1.5% (2020 est.)
  • 1.7% (2019 est.)
  • 2.0% (2018)
Population below poverty line
  • 15% (2014 est.)
  • Negative increase 18.0% at risk of poverty or social exclusion (2018)
Positive decrease 27.0 low (2018)
  • Increase 0.937 very high (2018)
  • 0.874 very high IHDI (2018)
Labour force
  • Increase 5,434,780 (2019)
  • Increase 82.4% employment rate (Target: 80%; 2018)
Labour force by occupation
  • agriculture: 1.1%
  • industry: 28.2%
  • services: 70.7%
  • (2008 est.)
Unemployment
  • Negative increase 7.6% (February 2020)
  • Negative increase 20.5% youth unemployment (Q4 2019)
Average gross salary
€40,000/ $54,000 annual (2014)
€31,000/ $40,000 annual (2014)
Main industries
Increase 10th (very easy, 2020)
External
ExportsIncrease $169.7 billion (2017)
Export goods
machinery, motor vehicles, paper products, pulp and wood, iron and steel products, chemicals, military armaments
Main export partners
ImportsIncrease$154.8 billion (2017)
Import goods
machinery, petroleum and petroleum products, chemicals, motor vehicles, iron and steel; foodstuffs, clothing
Main import partners
FDI stock
$0.5 trillion (31 December 2012 est.)
$939.9 billion (31 March 2016)
Public finances
41.4% of GDP (2016)
Revenues$0.27 trillion (2012 est.)
Expenses$0.27 trillion (2012 est.)
Economic aiddonor: ODA, ~$4 billion (April. 2007)
  • Standard & Poor's:
  • AAA (Domestic)
  • AAA (Foreign)
  • AAA (T&C Assessment)
  • Outlook: Stable
  • Moody's:
  • Aaa
  • Outlook: Stable
  • Fitch:
  • AAA
  • Outlook: Stable
  • Scope:
  • AAA
  • Outlook: Stable
Foreign reserves
$60 billion (31 December 2012 est.)
Main data source: CIA World Fact Book
All values, unless otherwise stated, are in US dollars.

The economy of Sweden is a developed export-oriented economy aided by timber, hydropower, and iron ore. These constitute the resource base of an economy oriented toward foreign trade. The main industries include motor vehicles, telecommunications, pharmaceuticals, industrial machines, precision equipment, chemical goods, home goods and appliances, forestry, iron, and steel. Traditionally a modern agricultural economy that employed over half the domestic workforce, today Sweden further develops engineering, mine, steel, and pulp industries that are competitive internationally, as evidenced by companies like Ericsson, ASEA/ABB, SKF, Alfa Laval, AGA, and Dyno Nobel.

Sweden is a competitive and highly liberalized, open market economy. The vast majority of Swedish enterprises are privately owned and market-oriented, combined with a strong welfare state involving transfer payments involving up to three-fifths of GDP. In 2014 the percent of national wealth owned by the government was 24%.

Due to Sweden being a neutral country that did not actively participate in World War II, it did not have to rebuild its economic base, banking system, and country as a whole, as did many other European countries. Sweden has achieved a high standard of living under a mixed system of high-tech capitalism and extensive welfare benefits. Sweden has the second highest total tax revenue behind Denmark, as a share of the country's income. As of 2012, total tax revenue was 44.2% of GDP, down from 48.3% in 2006.

In 2014 the National Institute of Economic research predicted GDP growth of 1.8%, 3.1% and 3.4% in 2014, 2015 and 2016 respectively. A comparison of upcoming economic growth rates of EU countries revealed that the Baltic states, Poland, and Slovakia are the only countries that are expected to keep comparable or higher growth rates.

History

In the 19th century Sweden evolved from a largely agricultural economy into the beginnings of an industrialized, urbanized country. Poverty was still widespread. However, incomes were sufficiently high to finance emigration to distant places, prompting a large portion of the country to leave, especially to the United States. Economic reforms and the creation of a modern economic system, banks and corporations were enacted during the later half of the 19th century. During that time Sweden was in a way the "powerhouse" of the Scandinavian region with a strong industrialization process commencing in the 1860s. Moreover, the Swedish Riksdag had developed into a very active Parliament already during the "Era of Liberty" (1719–72), and this tradition continued into the nineteenth century, laying the basis for the transition towards modern democracy at the end of said century. Apart from relatively high levels of human capital formation, the result of the Reformation and related government policies, such local democratic traditions were the other asset that made the "catching up" of the Scandinavian countries, including Sweden, possible and this economic rise was probably the most remarkable phenomenon in that region during the nineteenth century.

By the 1930s, Sweden had what Life magazine called in 1938 the "world's highest standard of living". Sweden declared itself neutral during both world wars, thereby avoiding much physical destruction and instead, especially after the First World War, profiting from the new circumstances – such as booming demand for raw materials and foodstuffs and the disappearance of international competition for its exports. The postwar boom, that was the continuation of strong inflationary tendencies during the war itself, propelled Sweden to greater economic prosperity. Beginning in the 1970s and culminating with the deep recession of the early 1990s, Swedish standards of living developed less favorably than many other industrialized countries. Since the mid-1990s the economic performance has improved.

In 2009, Sweden had the world's tenth highest GDP per capita in nominal terms and was in 14th place in terms of purchasing power parity.

Crisis of the 1990s

Sweden has had an economic model in the post-World War II era characterized by close cooperation between the government, labour unions, and corporations. The Swedish economy has extensive and universal social benefits funded by high taxes, close to 50% of GDP. In the 1980s, a real estate and financial bubble formed, driven by a rapid increase in lending. A restructuring of the tax system, in order to emphasize low inflation combined with an international economic slowdown in the early 1990s, caused the bubble to burst. Between 1990 and 1993 GDP went down by 5% and unemployment skyrocketed, causing the worst economic crisis in Sweden since the 1930s. According to an analysis published in Computer Sweden in 1992, the investment level decreased drastically for information technology and computing equipment, except in the financial and banking sector, the part of the industry that created the crisis. The investment levels for IT and computers were restored as early as 1993. In 1992 there was a run on the currency, the central bank briefly jacking up interest to 500% in an unsuccessful effort to defend the currency's fixed exchange rate. Total employment fell by almost 10% during the crisis.

A real estate boom ended in a bust. The government took over nearly a quarter of banking assets at a cost of about 4% of the nation's GDP. This was known colloquially as the "Stockholm Solution". In 2007, the United States Federal Reserve noted, "In the early 1970s, Sweden had one of the highest income levels in Europe; today, its lead has all but disappeared...So, even well-managed financial crises don't really have a happy ending".

The welfare system that had been growing rapidly since the 1970s could not be sustained with a falling GDP, lower employment and larger welfare payments. In 1994 the government budget deficit exceeded 15% of GDP. The response of the government was to cut spending and institute a multitude of reforms to improve Sweden's competitiveness. When the international economic outlook improved combined with a rapid growth in the IT sector, which Sweden was well positioned to capitalize on, the country was able to emerge from the crisis.

The crisis of the 1990s was by some viewed as the end of the much buzzed welfare model called "Svenska modellen", literally "The Swedish Model", as it proved that governmental spending at the levels previously experienced in Sweden was not long term sustainable in a global open economy. Much of the Swedish Model's acclaimed advantages actually had to be viewed as a result of the post WWII special situation, which left Sweden untouched when competitors' economies were comparatively weak.

However, the reforms enacted during the 1990s seem to have created a model in which extensive welfare benefits can be maintained in a global economy.

Data

The following table shows the main economic indicators in 1980–2017. Inflation under 2% is in green.

Year GDP
(in Bil. US$ PPP)
GDP per capita
(in US$ PPP)
GDP growth
(real)
Inflation rate
(in Percent)
Unemployment
(in Percent)
Government debt
(in % of GDP)
1980 87.5 10,516 Increase4.6 % Negative increase17.5 % 2.7 % n/a
1981 Increase100.0 Increase12,013 Increase4.5 % Negative increase12.1 % Negative increase3.4 % n/a
1982 Increase107.7 Increase12,933 Increase1.4 % Negative increase8.6 % Negative increase4.3 % n/a
1983 Increase114.3 Increase13,715 Increase2.1 % Negative increase8.9 % Negative increase4.8 % n/a
1984 Increase123.4 Increase14,791 Increase4.3 % Negative increase8.0 % Positive decrease4.2 % n/a
1985 Increase130.1 Increase15,582 Increase2.3 % Negative increase7.4 % Positive decrease3.9 % n/a
1986 Increase136.7 Increase16,315 Increase2.9 % Negative increase4.2 % Positive decrease3.6 % n/a
1987 Increase144.8 Increase17,211 Increase3.3 % Negative increase4.2 % Positive decrease2.9 % n/a
1988 Increase153.6 Increase18,155 Increase2.5 % Negative increase5.8 % Positive decrease2.4 % n/a
1989 Increase163.5 Increase19,172 Increase2.4 % Negative increase6.4 % Positive decrease2.0 % n/a
1990 Increase170.9 Increase19,891 Increase0.8 % Negative increase3.2 % Negative increase2.2 % n/a
1991 Increase174.8 Increase20,216 Decrease−1.0 % Negative increase8.8 % Negative increase4.0 % n/a
1992 Increase177.0 Increase20,363 Decrease−1.0 % Increase1.4 % Negative increase7.1 % n/a
1993 Increase177.7 Decrease20,315 Decrease−2.0 % Negative increase4.7 % Negative increase11.2 % 66.3 %
1994 Increase188.9 Increase21,421 Increase4.1 % Negative increase2.9 % Positive decrease10.8 % Negative increase68.7 %
1995 Increase200.6 Increase22,693 Increase4.0 % Negative increase2.5 % Positive decrease10.4 % Negative increase68.8 %
1996 Increase207.3 Increase23,439 Increase1.5 % Increase1.0 % Negative increase10.9 % Negative increase69.2 %
1997 Increase217.0 Increase24,524 Increase2.9 % Increase1.8 % Steady10.9 % Positive decrease68.0 %
1998 Increase228.6 Increase25,818 Increase4.2 % Increase1.0 % Positive decrease8.8 % Positive decrease65.8 %
1999 Increase242.6 Increase27,378 Increase4.5 % Increase0.6 % Positive decrease7.6 % Positive decrease60.5 %
2000 Increase259.9 Increase29,257 Increase4.7 % Increase1.3 % Positive decrease6.3 % Positive decrease50.6 %
2001 Increase270.0 Increase30,302 Increase1.5 % Negative increase2.7 % Positive decrease5.8 % Negative increase51.7 %
2002 Increase279.8 Increase31,294 Increase2.1 % Increase1.9 % Negative increase6.0 % Positive decrease49.8 %
2003 Increase292.1 Increase32,552 Increase2.4 % Negative increase2.3 % Negative increase6.6 % Positive decrease48.9 %
2004 Increase313.2 Increase34,754 Increase4.3 % Increase1.0 % Negative increase7.4 % Positive decrease47.9 %
2005 Increase332.4 Increase36,735 Increase2.8 % Increase0.8 % Negative increase7.6 % Negative increase48.2 %
2006 Increase358.6 Increase39,354 Increase4.7 % Increase1.5 % Positive decrease7.0 % Positive decrease43.1 %
2007 Increase380.7 Increase41,460 Increase3.4 % Increase1.7 % Positive decrease6.1 % Positive decrease38.2 %
2008 Increase386.0 Increase41,704 Decrease−0.5 % Negative increase3.3 % Negative increase6.2 % Positive decrease36.8 %
2009 Decrease368.8 Decrease39,483 Decrease−5.2 % Increase1.9 % Negative increase8.3 % Negative increase40.3 %
2010 Increase395.7 Increase42,022 Increase6.0 % Increase1.9 % Negative increase8.6 % Positive decrease38.6 %
2011 Increase414.6 Increase43,719 Increase2.7 % Increase1.4 % Positive decrease7.8 % Positive decrease37.9 %
2012 Increase421.0 Increase44,058 Decrease−0.3 % Increase0.9 % Negative increase8.0 % Negative increase38.1 %
2013 Increase433.1 Increase44,907 Increase0.4 % Increase0.4 % Steady8.0 % Negative increase40.8 %
2014 Increase452.4 Increase46,410 Increase2.6 % Increase0.2 % Positive decrease7.9 % Negative increase45.5 %
2015 Increase478.0 Increase48,519 Increase4.5 % Increase0.7 % Positive decrease7.4 % Positive decrease44.2 %
2016 Increase499.7 Increase49,996 Increase3.2 % Increase1.1 % Positive decrease7.0 % Positive decrease42.2 %
2017 Increase520.9 Increase51,475 Increase2.4 % Increase1.9 % Positive decrease6.9 % Positive decrease40.9 %

Contemporary economy

Real GDP growth in Sweden 1996–2006
 
Natural resources of Sweden. Fe – iron ore, PY – pyrite, Cu – copper, Zn – zinc, As – arsenic, Ag – silver, Au – gold, Pb – lead, U – uranium; in red: C – coal, OS – oil shale

Sweden is an export-oriented mixed economy featuring a modern distribution system, excellent internal and external communications, and a skilled labor force. Timber, hydropower and iron ore constitute the resource base of an economy heavily oriented toward foreign trade. Sweden's engineering sector accounts for 50% of output and exports. Telecommunications, the automotive industry and the pharmaceutical industries are also of great importance. Agriculture accounts for 2 percent of GDP and employment.

The 20 largest Sweden-registered companies by turnover in 2013 were Volvo, Ericsson, Vattenfall, Skanska, Hennes & Mauritz, Electrolux, Volvo Personvagnar, Preem, TeliaSonera, Sandvik, ICA, Atlas Copco, Nordea, Svenska Cellulosa Aktiebolaget, Scania, Securitas, Nordstjernan, SKF, ABB Norden Holding, and Sony Mobile Communications AB. Sweden's industry is overwhelmingly in public and state control, the most prominent example of this is LKAB, which is a state-owned mining company, mostly active in the northern part of the country, with the largest noted market share out of all its domestic competitors.

Some 4.5 million residents are working, out of which around a third with tertiary education. GDP per hour worked is the world's 9th highest at 31 USD in 2006, compared to 22 USD in Spain and 35 USD in United States. According to OECD, deregulation, globalization, and technology sector growth have been key productivity drivers. GDP per hour worked is growing ​2 12 per cent a year for the economy as a whole and trade-terms-balanced productivity growth 2%. Sweden is a world leader in privatized pensions and pension funding problems are small compared to many other Western European countries. Swedish labor market has become more flexible, but it still has some widely acknowledged problems. The typical worker receives only 40% of his income after the tax wedge. The slowly declining overall taxation, 51% of GDP in 2007, is still nearly double of that in the United States or Ireland. Civil servants amount to a third of Swedish workforce, multiple times the proportion in many other countries. Overall, GDP growth has been fast since reforms in the early 1990s, especially in manufacturing.

World Economic Forum 2012–2013 competitiveness index ranks Sweden 4th most competitive. The Index of Economic Freedom 2012 ranks Sweden the 21st most free out of 179 countries, or 10th out of 43 European countries. Sweden ranked 9th in the IMD Competitiveness Yearbook 2008, scoring high in private sector efficiency. According to the book, The Flight of the Creative Class, by the U.S. urban studies, Professor Richard Florida of University of Toronto, Sweden is ranked as having the best creativity in Europe for business and is predicted to become a talent magnet for the world's most purposeful workers. The book compiled an index to measure the kind of creativity it claims is most useful to business – talent, technology and tolerance. Sweden's investment into research and development stood, in 2007, at over 3.5% of GDP. This is considerably higher than that of a number of MEDCs, including the United States, and is the largest among the OECD members.

Sweden rejected the Euro in a referendum in 2003, and Sweden maintains its own currency, the Swedish krona (SEK). The Swedish Riksbank – founded in 1668 and thus making it the oldest central bank in the world – is currently focusing on price stability with its inflation target of 2%. According to Economic Survey of Sweden 2007 by OECD, the average inflation in Sweden has been one of the lowest among European countries since the mid-1990s, largely because of deregulation and quick utilization of globalization.

The largest trade flows are with Germany, United States, Norway, United Kingdom, Denmark and Finland. 

The Swedish economic picture has brightened significantly since the severe recession in the early 1990s. Growth has been strong in recent years, and even though the growth in the economy slackened between 2001 and 2003, the growth rate has picked up since with an average growth rate of 3.7% in the last three years. The long-run prospects for growth remain favorable. The inflation rate is low and stable, with projections for continued low levels over the next 2–3 years.

Since the mid-1990s the export sector has been booming, acting as the main engine for economic growth. Swedish exports also have proven to be surprisingly robust. A marked shift in the structure of the exports, where services, the IT industry, and telecommunications have taken over from traditional industries such as steel, paper and pulp, has made the Swedish export sector less vulnerable to international fluctuations. However, at the same time the Swedish industry has received less money for its exports while the import prices have gone up. During the period 1995–2003 the export prices were reduced by 4% at the same time as the import prices climbed by 11%. The net effect is that the Swedish terms-of-trade fell 13%.

By 2014, legislators, economists and the IMF were warning of a bubble with residential property prices soaring and the level of personal mortgage debt expanding. Household debt-to-income rose above 170% as the IMF called on legislators to consider zoning reform and other means of generating a greater supply of housing as demand was outstripping supply. By August 2014, 40% of home borrowers had interest-only loans while those that didn't were repaying principal at a rate that would take 100 years to fully repay.

Government

The government budget has improved dramatically from a record deficit of more than 12% of GDP in 1993. In the last decade, from 1998 to present, the government has run a surplus every year, except for 2003 and 2004. The surplus for 2011 is expected to be 99 billion ($15b) kronor. The new, strict budget process with spending ceilings set by the Riksdag, and a constitutional change to an independent Central Bank, have greatly improved policy credibility.

From the perspective of longer term fiscal sustainability, the long-awaited reform of old-age pensions entered into force in 1999. This entails a far more robust system vis-à-vis adverse demographic and economic trends, which should keep the ratio of total pension disbursements to the aggregate wage bill close to 20% in the decades ahead. Taken together, both fiscal consolidation and pension reform have brought public finances back on a sustainable footing. Gross public debt, which jumped from 43% of GDP in 1990 to 78% in 1994, stabilised around the middle of the 1990s and started to come down again more significantly beginning in 1999. In 2000 it fell below the key level of 60% and had declined to a level of 35% of GDP as of 2010.

Economic and monetary union

Current economic development reflects a quite remarkable improvement of the Swedish economy since the crisis in 1991–93, so that Sweden could easily qualify for membership in the third phase of the Economic and Monetary Union of the European Union, adopting the euro as its currency. In theory, by the rules of the EMU, Sweden is obliged to join, since the country has not obtained exception by any protocol or treaty (as opposed to Denmark and the United Kingdom). Nevertheless, the Swedish government decided in 1997 against joining the common currency from its start on 1 January 1999. This choice was implemented by exploiting a legal loophole, deliberately staying out of the European Exchange Rate Mechanism. This move is currently tolerated by the European Central Bank, which however has warned that this would not be the case for newer EU members.

In the first years of the twenty-first century, a majority for joining emerged in the governing Social Democratic party, although the question was subject of heated debate, with leading personalities in the party on both sides. On 14 September 2003, a national referendum was held on the euro. A 56% majority of Swedes rejected the common currency, while 42% voted in favour of it. Currently no plans for a new referendum or parliamentary vote on the matter are being discussed, though it has been implied that another referendum may take place in around ten years.

Unemployment

In contrast with most other European countries, Sweden maintained an unemployment rate around 2% or 3% of the work force throughout the 1980s. This was, however, accompanied by high and accelerating inflation. It became evident that such low unemployment rates were not sustainable, and in the severe crisis of the early 1990s the rate increased to more than 8%. In 1996 the government set out a goal of reducing unemployment to 4% by 2000. During 2000 employment rose by 90,000 people, the greatest increase in 40 years, and the goal was reached in the autumn of 2000. The same autumn the government set out its new target: that 80% of the working age population will have a regular job by 2004. Some have expressed concern that meeting the employment target may come at a cost of too high a rate of wage increases hence increasing inflation. However, as of August 2006, roughly 5% of working age Swedes were unemployed, over the government-established goal. However, some of the people who cannot find work are put away in so-called "labour market political activities", referred to as "AMS-åtgärder".

According to Jan Edling, a former trade-unionist, the actual number of unemployed is far higher, and those figures are being suppressed by both the government and the Swedish Trade Union Confederation. In Edling's report he added that a further 3% of Swedes were occupied in state-organised job schemes, not in the private sector. He also claimed a further 700,000 Swedes are either on long-term sick leave or in early retirement. Edling asks how many of these people are in fact unemployed. According to his report, the "actual unemployment" rate hovers near 20%. Some critics disagree with this concept of "actual" unemployment, also termed "broad unemployment", since they do not see e.g. students who rather want a job, people on sick leave and military conscripts as "unemployed".

According to Swedish Statistics, unemployment in June 2013 was 9.1% in the general population and 29% amongst 15- to 25-year-olds.

Trade unions

Around seventy percent of the Swedish labour force is unionised. For most unions there is a counterpart employer's organization for businesses. The unions and employer organisations are independent of both the government and political parties, although the largest confederation of unions, the National Swedish Confederation of Trade Unions or LO (organising blue-collar workers), maintains close links to one of the three major parties, the Social Democrats.

The unionisation rate among white-collar workers is exceptionally high in Sweden – since 2008 higher than for blue-collar workers. In 2018, blue-collar density was 59%, and white-collar density was 72% (full-time students working part-time excluded). Just before the considerably raised fees to union unemployment funds in January 2007, blue-collar and white-collar union density was the same (77% in 2006). The average union density was 70% both in 2011, 2012 and 2013. There are two major confederations that organise professionals and other qualified employees: the Swedish Confederation of Professional Employees (Tjänstemännens Centralorganisation or TCO) and the Swedish Confederation of Professional Associations (Sveriges Akademikers Centralorganisation or SACO). They are both independent from Sweden's political parties and never endorse candidates for office in political elections.

There is no minimum wage that is required by legislation. Instead, minimum wage standards in different sectors are normally set by collective bargaining. About 90% of all workers are covered by collective agreements, in the private sector 84% (2017). The high coverage of collective agreements is achieved despite the absence of state mechanisms extending collective agreements to whole industries or sectors. This reflects the dominance of self-regulation (regulation by the labour market parties themselves) over state regulation in Swedish industrial relations.

Sweden has not joined the EMU (the Economic and Monetary Union / the Euro) and will not in the foreseeable future. When the issue was at the agenda, the Swedish union movement was very split. In contrast to the very positive attitude of employers' associations, the union rank-and file opinion was so split that several unions, as well as the confederations LO, TCO and SACO, abstained from taking an official position.

Labour force

The traditionally low wage differential has increased in recent years as a result of increased flexibility as the role of wage setting at the company level has strengthened somewhat. Still, Swedish unskilled employees are well paid while well educated Swedish employees are low-paid compared with those in competitor countries in Western Europe and the US. The average increases in real wages in recent years have been high by historical standards, in large part due to unforeseen price stability. Even so, nominal wages in recent years have been slightly above those in competitor countries. Thus, while private-sector wages rose by an average annual rate of 3.75% from 1998 to 2000 in Sweden, the comparable increase for the EU area was 1.75%. In the year 2000 the total labour force was around 4.4 million people.

Ongoing and finished privatisations

The Swedish government has announced that it will privatise a number of wholly and partly state owned companies."The income from these sales will be used to pay off the government debt and reduce the burden of debt for future generations. The Government's ambition is to sell companies to a value of SEK 200 billion during 2007–2010."
Ongoing Privatisations

  • Telia Soneratelecom. 37.3% owned by the Swedish government. Hitherto SEK 18 billion worth of shares has been sold reducing state ownership from 45.3% to 37.3%.
  • SAS Group – airline. 14.8% owned by the Swedish government. On 13 October 2016 the Swedish government sold 13.8 million shares worth 213.9 million SEK. The Minister of Enterprise, Mikael Damberg stated that "There exists good reasons for the Swedish government not be a long-term owner of a publicly traded airline... This sell-off is a first step towards reducing the Swedish government's ownership in a responsible manner."
Completed Privatisations

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