23.06.201710:25:00UTC+00Swedish Unemployment Rate Set To Drift Lower This Year

Sweden's unemployment rate is likely to ease in the coming months of this year, while the annual employment growth may slow, Stephen Brown, an economist at Capital Economics, said this week.

Official data released on June 20 showed that the seasonally adjusted jobless held steady at 6.7 percent in May, slightly above consensus. After several months of strong gains, employment dropped for the second straight month, though marginally. Nonetheless, employment rose 1.9 percent in annual terms in May.

The recent employment indicators of the purchasing managers' survey suggest that annual employment growth is unlikely to rebound back above 2.0 percent on a sustained basis, Brown observed.

The economist expects wage growth to pick up in the near term, as over one third of firms are suffering from a shortage of labor. "So even if Swedish annual employment growth slows as we expect, there would be further upward pressure on wages," the economist predicted.