With less than six hours to go until the midnight strike deadline, the trade union Handels agreed on a 2.6 per cent income increase for its 6,000 members. It had been locked in negotiations with employers group Svensk Handel for most of the week.
The threatened strike, meant to begin at midnight in the commercial sector, was predicted to cost the Swedish economy several millions of dollars.
Salaries will now go up by 2.6 per cent, less than the union asked for, more than the employers wanted.
Representatives for the union say closing the gender gap in employees' salaries, as well as more focus on job security, are among its gains, according to the news agency TT.
Youth unemployment was also on the agenda.
"We've created possibilities for young people to enter work places and to have professional internships for those under the age of 21, that's our contribution to tackling youth unemployment," union negotiator Lars-Anders Häggström says in a press release.
His counterpart Dag Klackenberg at Svensk Handels echoes his optimism about introducing the young to the sector - with salaries equivalent to 75 per cent of what the average sector employee is paid.