Regional growth 2009
– a report on the status and development of Sweden’s functional analysis regions
The Swedish Agency for Growth Policy Analysis (Growth Analysis) report Regional growth 2009 describes the status and development of Sweden’s functional analysis (FA) regions with the help of a number of indicators and factors for growth. The report comprises two parts where part one describes the development based on a national perspective and part two describes the development based on a more regional perspective.
Of Sweden’s 72 FA regions, only 21 had a positive population growth in the period 1990-2008. Compared with regional population growth in the 1990s, there was some improvement in the 2000s, but strong population decreases remain in a number of smaller FA regions. Immigration accounts for a large share of the improvement in the regions. All FA regions had an immigration surplus in the period 2000-2008. However, immigrants have proven to also have a certain tendency to move on. Consequently, immigrants (eventually) contribute to a relatively large domestic relocation deficit in many smaller FA regions. With regard to the development of the population trend in terms of births and deaths, it is generally only the largest FA regions that exhibited a net increase in births in 2000- 2008. This made the large regions less reliant on an influx from other regions.
Prolonged regional population trends have led to growing numbers of people living in ever fewer FA regions. Geographical population concentration has increased continuously since the 1970s. The young population accounts for the main increase in concentration in Sweden. In many regions, particularly smaller regions, there is a large imbalance between various age groups. Several of the small FA regions are approaching a situation where there is one person of an employable age (20-64 years) for every person in the other ages.
The general level of education for Sweden as a whole increased, although large regional differences remain. The level of education is significantly higher in the larger regions. The differences in the level of education between large and small FA regions also continued to grow in the 2000s. These disparities also grew larger between regions of the same size category.
In 2007, there were 70,000 fewer people gainfully employed than at the beginning of the 1990s. The 1990s was a troublesome period of adjustment where most FA regions experienced a negative employment trend. This situation changed in the latter part of the 2000s and has been very positive for most regions.
Sweden’s regions were hit hard by the financial crisis in 2008. Preliminary figures indicate that the number of jobseekers increased markedly in all regions. However, it is too early to provide a more detailed illustration of the impact of the crisis on Sweden’s regions due to a lack of reliable statistics. Growth Analysis intends to present an analysis of the impact of the financial crisis at the beginning of 2010.
The largest change in the economic structure in the period 2000-2007 took place in business-oriented services and manufacturing and mining. The proportion of employment in manufacturing and mining decreased while the proportion of employment in business-oriented services increased. On a national level, businessoriented services are the second largest industry after public household services.
Regional business in the metropolitan regions and regional centres is generally characterised by a high level of industry diversification and low workplace concentration. Small regions, on the other hand, generally have a low level of industry diversification and high workplace concentration. This indicates that the small regions are more vulnerable to economic shocks.
In much the same way that the population is highly concentrated to the largest regions, the production values are also concentrated to a few FA regions. Slightly more than half of Sweden’s total daily wage sum in 2007 originated in the metropolitan regions of Stockholm, Gothenburg and Malmö. This concentration has not decreased in the past decade either, but rather increased. Compared to other OECD countries, Sweden has a high concentration of production value. However, the regional income distribution, i.e. income per capita, has decreased strongly in the past six years. This is attributed to the concentration tendencies for the population and production tracking one another.
Growth of the regions was examined based on the measures of labour productivity and income per capita. It can be confirmed that growth in labour productivity in the period 1997-2007 was 2 per cent nationwide while the corresponding figure for income per capita amounted to 3.1 per cent. Since growth of the day and night wage totals was largely the same, the difference in growth between labour productivity and income per capita is attributed to differences in growth in population and employment. During the period, the population grew by an average of 0.37 per cent per year while employment grew by 1.45 per cent. Consequently, not only a positive productivity trend is needed in order for a region to develop positively. Instead, production, employment and population must increase at the same time.
The regional development of labour productivity amounts to between 1 to 3 per cent. Besides the metropolitan regions, it was primarily industry-heavy FA regions that developed best.