Sweden does not have the population to support its welfare state

[Peter1469]

Sweden does not have the population to support its welfare state

We are in a similar boat but for slightly different reasons.

By 2025, its entire workforce is expected to grow by 207,000 people—yet it needs more than that number just to staff its fabled welfare state. The worker shortfall could crimp services and raise labor costs, especially in a political environment less hospitable to immigration.



The mismatch is one of the biggest headaches facing Sweden’s next government. Past precedents don’t bode well. The workforce rose by 488,000 between 2007 and 2017, with less than a third of that increase absorbed by the public sector.

Local authorities recruiting 208,000 workers is “not a credible scenario,” said Annika Wallenskog, chief economist at the Swedish Association of Local Authorities and Regions. The real risk is that the public and private sectors end up competing for the same workers, she said.




The government is going to have to come up with some seriously big ideas on how to make up for future labor shortages. Immigration has also become an especially sensitive topic since the country re-imposed border controls in the wake of the 2015 refugee crisis.

That last paragraph is odd- uneducated Arabs and North Africans will exacerbate their fiscal problems, not boost their welfare system.

[midcan5]

This negative baloney about welfare and population seems to contradict itself. If population decreases and humans die, as I've heard they do, wouldn't support decrease? Or does that seem too logical for those who only see the empty part and the hole?

[Chris]

This negative baloney about welfare and population seems to contradict itself. If population decreases and humans die, as I've heard they do, wouldn't support decrease? Or does that seem too logical for those who only see the empty part and the hole?

I think that the story is not about welfare but hiring enough government bureaucrats to keep the welfare state functioning.

[Peter1469]

This negative baloney about welfare and population seems to contradict itself. If population decreases and humans die, as I've heard they do, wouldn't support decrease? Or does that seem too logical for those who only see the empty part and the hole?

The issue is the ratio between retirees and workers who pay into the welfare state to fund the government programs.

Does that help?

Remember, there is no such this as a stupid question.

[Captdon]

This negative baloney about welfare and population seems to contradict itself. If population decreases and humans die, as I've heard they do, wouldn't support decrease? Or does that seem too logical for those who only see the empty part and the hole?

Use your brain. The increase isn't going to be enough. The increase takes the death rate into consideration.

[Peter1469]

I think that the story is not about welfare but hiring enough government bureaucrats to keep the welfare state functioning.

That issue is the government competing with the private sector for too few workers.

The main point, is that Sweden's pensions for retirees are going to be slashed to the bones because there won't be enough well paid workers paying into the system.

[Chris]

The issue is the ratio between retirees and workers who pay into the welfare state to fund the government programs.

Does that help?

Remember, there is no such this as a stupid question.

Ah, OK, now I see. And that is similar to our situation with more boomers than young uns following.

[Peter1469]

Ah, OK, now I see. And that is similar to our situation with more boomers than young uns following.

Yes.

The concepts of solvency, sustainability, and budget impact are common in discussions of Social Security, but are not well understood. Currently, the Social Security Board of Trustees projects program cost to rise by 2035 so that taxes will be enough to pay for only 75 percent of scheduled benefits. This increase in cost results from population aging, not because we are living longer, but because birth rates dropped from three to two children per woman. Importantly, this shortfall is basically stable after 2035; adjustments to taxes or benefits that offset the effects of the lower birth rate may restore solvency for the Social Security program on a sustainable basis for the foreseeable future. Finally, as Treasury debt securities (trust fund assets) are redeemed in the future, they will just be replaced with public debt. If trust fund assets are exhausted without reform, benefits will necessarily be lowered with no effect on budget deficits.