Recruiting Immigrant Workers

ISSN :
2225-7969 (online)
ISSN :
2225-7950 (print)
DOI :
10.1787/22257969
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This series considers labour migration policies in OECD countries. It examines whether labour migration policy is effective and efficient. Each study in the series covers a specific country. Each looks at discretionary labour migration – that is, labour migration movements over which policy has direct, immediate oversight – focusing on two key areas: the country’s labour migration system and its characteristics; and the extent to which policy is responding to the needs of the domestic labour market and its impact on the latter.

 
Recruiting Immigrant Workers: Sweden 2011

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Author(s):
OECD
Publication Date :
19 Dec 2011
Pages :
160
ISBN :
9789264167216 (PDF) ; 9789264167209 (print)
DOI :
10.1787/9789264167216-en

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Sweden reformed its labour migration management policy in 2008 and now has one of the most liberal labour migration regimes in the OECD. This book attempts to answer the question of whether Sweden’s labour migration policy is efficiently working to meet labour market needs that were not being met, without adversely affecting the domestic labour market. The review also examines the impact of the reform on labour migration flows to Sweden and on access to recruitment from abroad by Swedish employers.

After the reform, employers in Sweden were able to recruit  workers from abroad for any occupation, as long as the job had been advertised for a nominal period and the prevailing collective bargaining wage and contractual conditions were respected. Overall, Sweden’s new system has not led to a boom in labour migration, although this somewhat surprising result may be related to the slack labour market. The faith in employers appears to be largely justified until now, although there are some vulnerabilities in the system which could be addressed, especially in monitoring workplaces not covered by collective bargaining, and marginal businesses. The particularities of the relatively highly regulated labour market in Sweden may mean that this model is not easily transferable to other countries, but lessons can be drawn for other countries.

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    Foreword
    This review of Sweden’s labour migration policy is the first of a series to be conducted by the Secretariat, as a follow-up to the 2009 High-Level Policy Forum on International Migration which included the presentation of a roadmap for managing labour migration. The rationale for this initiative was the growth in labour migration observed in many countries in the recent past and the likelihood that recourse to further labour migration would increase in the context of demographic ageing. Many countries prior to the current economic crisis had made substantial changes to labour migration policies with a view to facilitating recruitment from abroad. With the introduction of these changes, more prominence was accorded to the question of their effectiveness and more broadly, to the objectives of labour migration policy in general.
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    Assessment and Recommendations
    Sweden introduced a radical reform of its labour migration management policy at the end of 2008. The main impetus for the reform was concerns regarding population ageing and shortages of workers. Sweden is facing the retirement of the baby-boom generation, and youth cohorts will be smaller than retiring cohorts in the next decades. Increasing concern about future labour shortages led over the past decade to considerable debate over recruitment from abroad, culminating in the 2008 reform.
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    Bedömning och rekommendationer
    I slutet av 2008 genomförde Sverige en genomgripande reform av regelverket kring arbetskraftsinvandring. Den främsta drivkraften bakom reformen var oro över en åldrande befolkning och brist på arbetskraft. Sverige står inför en situation där babyboom-generationen är på väg att bli pensionärer och där ungdomsgrupperna under de närmaste decennierna kommer att bli mindre än pensionärsgrupperna. En ökad oro över framtida brist på arbetskraft har under det senaste decenniet lett till livliga diskussioner om rekrytering från utlandet, vilket kulminerade i 2008 års reform.
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    Évaluation et recommandations
    Fin 2008, la Suède a procédé à une réforme complète de son régime de gestion des migrations de travail. Cette réforme était principalement motivée par les problématiques relatives au vieillissement de la population et à la pénurie de main-d’oeuvre. La Suède doit faire face au départ en retraite de la génération du baby boom et, dans les prochaines décennies, les cohortes de jeunes seront moins nombreuses que les cohortes d’adultes partant à la retraite. Ces dix dernières années, les préoccupations croissantes quant à d’éventuelles futures pénuries de main-d’oeuvre ont suscité d’importants débats sur l’embauche de travailleurs étrangers, qui ont abouti à la réforme de 2008.
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    Introduction
    In December 2008 Sweden liberalised its labour migration law to an open demand-driven system. Employers can recruit any non-EU third country national from abroad for any skill level, provided they have advertised the position beforehand and prevailing contractual conditions in that occupation are respected. This review analyses the impact of the reform, as well as the efficiency and the effectiveness of the new labour migration system in Sweden.
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    Context for labour migration in Sweden
    Sweden, a country with a strong welfare state and export oriented economy, has a relatively high participation rate and a low unemployment rate, although the recent economic crisis has hit the country hard. Future demographic challenges will put pressure on the labour market, as the Swedish labour force is expected to shrink. Labour migration can play a role in this context where labour shortages are likely to arise, although to a limited extent.
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    Migration to Sweden
    Sweden has a large stock of migrants – about one in seven residents – half of whom have acquired Swedish citizenship. Yet among OECD countries, Sweden had one of the lowest levels of discretionary labour migration relative to population and employment, and most migration to Sweden in recent years has been through family and humanitarian channels. The employment outcomes for non-labour migrants have been poor.
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    The evolution of Swedish labour migration policy
    From 1972 to 2008, Sweden maintained a restrictive policy on labour migration. The 2008 reform was the result of almost a decade of debate and institutional discussion. The 2008 law allows employers to recruit for any occupation, and grants renewable permits to all incoming labour migrants, with the possibility of permanent residence after four years. The trade unions provide an opinion on whether the job offer conforms to the prevailing Swedish wage and conditions, but they no longer hold a veto over the employer request. The absence of a cap on entries or sector restrictions, and the nominal nature of the labour market test, make Sweden’s new policy more open than those of most other OECD countries.
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    Impact of the Swedish policy reform
    Overall, Sweden’s new labour migration regime has not led to a boom in labour migration, although the number of new non-seasonal labour migrants to Sweden increased in 2009, and rose further in 2010 and 2011. The reform allowed recruitment for lesser-skilled jobs in occupations and sectors in which labour migrants had not previously come, especially restaurants and hospitality and cleaning. The average permit duration is now longer, and the stay rate is higher, although seasonal work remains significant...
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    Evaluating the new Swedish labour migration policy
    The Swedish labour migration policy seems to effectively meet labour market needs without adverse effects. Almost half of the labour migrants coming to Sweden went into occupations that were in shortage. Chief among these is the IT sector, which attracts a large number of shortterm labour migrants, including intra-corporate transfers. Recruitment from abroad is only a small part of total hiring in Sweden, and does not closely correspond to total job openings.
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    Drawing lessons from Sweden's labour migration policy
    Sweden provides an example of a country where a sudden easing of restrictions on labour migration has not led to a boom in demand. Most employers still seem to be reluctant to use international recruitment, despite the relatively simple, inexpensive and rapid process. While wages of natives do not appear to have been affected, there is increasing recruitment for low-skilled jobs for which no local shortage is apparent. The transferability of the Swedish system to other countries may be limited due to the characteristics of co-operation among social partners and the Swedish labour market itself.
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    Abbreviations
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    Characteristics of labour market tests in different countries
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    Application forms for Swedish work permits and offers of employment
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    STATIV database
    The STATIV database is constructed by Statistics Sweden from several administrative data registers in Sweden. It covers the entire population registered as resident in Sweden on the 31st of December of each year. The quality of coverage of the database thus depends on the over- or undercoverage of the population register. Under-coverage of newborns or the overcoverage due to deaths is small, although over-coverage of individuals who left country without de-registering from the public records is somewhat higher (estimated around 35 000 in 2004), but concerns mostly Swedish citizens (SCB, 2011).
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    Shortage occupation list for in-country changes in Sweden (1 April 2011)
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    Supplementary tables on occupations in Sweden
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