Northern Europe closes to immigration despite labor shortage

2023-09-22 08:00:12

From 1is October, the rules for obtaining a work permit in Sweden will change. Until now, the minimum salary required to obtain a residence permit was 13,000 crowns (1,100 euros) per month. It will double to 26,500 crowns, or 80% of the Swedish median salary. A measure criticized by businesses and local authorities, who fear seeing the labor shortage worsen.

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Proposed by the Social Democrats when they were still in power, the reform was voted on in Parliament on November 30, 2022, at the initiative of the new majority, made up of the conservative liberal right and the far right. It has two objectives: to fight against abuses by unscrupulous employers, but above all to reduce the arrival of low-skilled workers.

In 2022, Sweden granted 37,000 work permits to nationals from countries outside the European Union (two thirds of which were for a first application). Among them: 6,500 seasonal workers, hired to pick berries in Swedish forests, but also 8,700 computer testing technicians, catering employees and home help services. Leading the way: around a quarter came from India.

Collective agreements

According to a report published in June by the Swedish Confederation of Industries, this labor immigration contributed 43 billion crowns to Sweden’s gross domestic product, generating 14 billion crowns in tax revenue. However, the new rules could halve arrivals, says Karin Johansson, vice-president of the confederation, because “Half of the people who obtained a work permit had a monthly salary of less than 26,500 crowns”.

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They are not the only ones: according to the Central Bureau of Statistics, around 15% of employees on permanent contracts in Sweden are in the same situation. The Mediation Institute in Stockholm estimates that almost a hundred collective agreements provide for minimum wages below the new floor imposed by the government. Karin Johansson sees this “a challenge to the collective bargaining system, since, by imposing a minimum wage for immigrant workers higher than what exists in certain sectors, the government is calling into question the agreements made between unions and employers”.

At the head of the Association of Swedish Municipalities and Regions, Anders Henriksson approves: “We think it’s a good thing that the government wants to fight against the exploitation of foreign workers. But, instead of setting an income indexed to the median wage, it would have been much more judicious to impose as a limit the minimum wage set out in collective agreements. »

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