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Sweden

Basic Economic Summary

Overview

Sweden has a reputation for being a haven for expats looking to relocate, as the country offers decent salaries, productive working conditions and a generous number of leaves. However, the high demand of internationals looking for opportunities in Sweden has led to the companies becoming selective.

The job market is competitive and requires a good knowledge of both Swedish and English languages. The nation is revered for its beliefs on gender and class equality, which is evident in their workspaces. As Sweden’s economy recovers to its growth levels, the opportunities are primed to grow.

Basic Information

  • Local Languages: Swedish, English
  • Major Economic Hubs: Stockholm, Goteborg, Malmo, Uppsala
  • Capital: Stockholm
  • Currency: Swedish Krona
  • Population: 10.19 million
  • Date Format: yyyy/mm/dd

Useful Information

  • GDP Per Capita (in USD, 2020): 51,620
  • Exchange Rate (SEK/USD): 0.11 
  • PISA Ranking (2021): 16
  • Number of University Graduates (2019/20): 44,372

Local Universities

Top Local Universities

University Rankings
KTH Royal Institute of Technology Ranking in Sweden: 1, World Ranking: 163
Lund University Ranking in Sweden: 2, World Ranking: 219
Uppsala University Ranking in Sweden: 3, World Ranking: 240
Linköping University Ranking in Sweden: 4, World Ranking: 265
Gothenburg University Ranking in Sweden: 5, World Ranking: 338

Salary Data

Average Salary of Jobs (Per Month)

Job Title Average Salary Range (SEK) Average Salary Range (USD)
Surgeons/Doctors 43,600 - 201,000 4,802.08 - 22,138.04
Judges 67,500 - 189,000 7,434.42 - 20,816.37
Lawyers 40,500 - 140,000 4,460.65 - 15,419.53
Bank Managers 49,500 - 146,000 5,451.91 - 16,080.37
Chief Executive Officer 53,000 - 169,000 5,837.39 - 18,613.58
Chief Financial Officers 48,800 - 140,000 5,374.81 - 15,419.53

Talent Sourcing Tips

Taxes

Employer Payroll Tax

The employer payroll tax is calculated as follows:

Category Rate
Retirement Pension Contribution 10.21%
General Payroll Tax 11.62%
Health Insurance 3.55%
Occupational Injury 0.02%
Parental Insurance 2.6%
Survivor’s Pension 0.60%
Labour Market Fee 2.64%
Total 31.24%

Employee Payroll Tax

The employee payroll tax is calculated as follows:

Category Rate
Pension Insurance 7%
Total 10.20%

Employee Income Tax

The income tax rate in Sweden is as follows:

Taxable income (SEK *) National income tax (%) Municipal income tax ** (%)
From 0 to 523,200 0.00 32.00
Over 523,200 20.00 32.00%

Minimum Wage & Payroll

Minimum Wage

There is no official minimum wage in Sweden.

Payroll Cycle

The employee must be paid monthly.

Bonus

13th month salary

There is no specific provision of 13th month salary in Sweden

Working Hours & Statutory Leave

Working hours

The standard number of working hours in Sweden is 8 hours a day for 5 days or 40 hours a week. Employees are also entitled to a break after every 5 hours.

Overtime pay

Employees are allowed to work for a maximum of 50 hours overtime in a month and the employee is usually paid at a rate of 50% to 100%.

Public Holidays

Number of public holidays is 16 days. The list of holidays can be found here.

Leaves

Annual Paid Leave

Annual leave in Sweden is for about 25 days.

Sick Leave

Under the Swedish law, people who are sick generally receive 80% of their salary from the employer for the first 14 days of their illness. Thereafter the employee can apply for sick benefits from the Swedish Social Insurance Agency.

Parental Leave

In Sweden, a total of 480 days of parental leave is allocated to both parents - 240 days each.

Offboarding & Termination

Termination Process

Termination in Sweden can take place with or without notice. However, a dismissal notice must be on objective grounds only.

Notice Period

The collective notice period is one month if the employee is employed for less than two years of service. It can be extended as follows:

  • 2 to 4 years - 2 months 
  • 4 to 6 years - 3 months 
  • 6 to 8 years - 4 months 
  • 8 to 10 years - 5 months 
  • Over 10 years - 6 months 

Severance Pay

There are no provisions regarding severance pay in Sweden.

Probation period

The probation labour contract is six months.

Employee Benefits

Insurance

Other than the insurances included in the employer social security contribution, the employer is under no obligation by the law to provide employees with any other insurances. However, those employers bound by collective bargaining agreements can take out particular insurances, like group life insurance or work injury insurance, apart from the insurance being provided to the employees.

Employee Stock Ownership Plan (ESOP)

ESOP is a term which originated from the startup culture in the US and is known as QESOs (Qualified Employee Stock Options) in Sweden. An important difference between ESOPs and QESOs is that the latter is not a collective pool of stock options given to the employee. To issue QESOs, the company must issue new QESOs every time they allot them to the employees. Furthermore, the issuance and the allotment of QESOs must be validated in the shareholders’ agreement.

Not every startup in Sweden can issue a QESO as there are many conditions to fulfil. The company needs to be:

  • An unlisted limited liability company
  • Less than 50 employees in size
  • Have net sales or balance sheet totalling to a maximum of SEK 80 million in the previous financial year
  • Less than 10 years old

Banking, real estate, financial trading and real estate leasing companies are exempted from issuing QESOs. 

Additionally, there is a limited number of QESO which can be allotted to employees. The value of QESOs must not exceed SEK 3 million per employee and SEK 75 million for all employees.

Interestingly, there are conditions for employees to be qualified for receiving QESOs.Such shares expire when an employee quits within their initial three-year vesting period. Furthermore, the employee must have worked an equivalent of at least 75 percent of their full-time job and received a minimum salary of 13 Swedish Income Base Amounts.

VAT

The standard VAT rate in Sweden is 25%.

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