Income inequality is growing across Sweden

5:25 min

The income gap between rich and poor has been on the rise and the number of middle class households has fallen in almost every municipality in Sweden, according to a survey by the newspaper Dagens Samhälle.

In 273 out of 290 municipalities, the number of wealthy households increased over the five-year survey period, while at the same time, the number of poor households rose in 264 municipalities. The number of middle income households dropped in 286 municipalities in the five year span.

Though the numbers have come as somewhat of a shock, this is not a new problem in Sweden. Income inequality has been growing since 1980, but the income gap has spiked dramatically in recent years.

Jesper Roine, an associate professor at the Stockholm School of Economics (SSE) and Deputy Director at the Stockholm Institute of Transition Economics, believes that one of reasons for this is that the welfare compensation, in terms of sick pay and unemployment, has not increased much over time. He said:

Over the past 10-15 years social security systems in Sweden have not increased at the same rate as wages and this, in turn, has caused those in the lower end of the distribution to fall behind."

The areas that have taken in the most refugees are among those with the fastest rates of poverty growth.

Ardalan Shekarabi, Sweden’s minister for public administration, says that the government is already working to help the most affected municipalities.

“We have just started to work to fix the equalization system. The municipalities that have taken the responsibility for receiving refugees must be well-equipped to deal with the welfare that is needed,” he told Swedish Television.

The survey also found that the overwhelming majority of municipalities with the highest proportion of high income earners are in and around metropolitan centers. Of the 20 areas with the greatest number of rich households, 14 are in Stockholm, two outside of Malmö, and one outside of Gothenburg.