New rules risk slowing down the tech industry's skills supply
On Thursday, the report on needs-tested labor immigration was handed over to Minister of Migration Maria Malmer Stenergard. TechSweden criticizes the committee's proposals, which risk becoming both wage-driving, lead to higher labor costs and hamper the tech the tech industry's supply of skills.
The report proposes that the government introduce a wage floor and a labor market test. In practice, this means that companies wishing to recruit third-country nationals for a particular occupation must offer a monthly salary that is on a par with the median salary, which currently corresponds to SEK 34,200. This applies if the occupation is not on the government's "shortage occupation list".
The proposal for a wage floor and labor market testing represents a major departure from the current demand-based system, where collectively agreed wages are the starting point.
"Sweden has a successful labor market model where wages and conditions are negotiated between the parties in the labor market and not by the state. The proposal for a wage floor risks becoming wage-driving and leading to higher labor costs," says Ana Andric, industry policy expert at TechSverige.
New rules - risk impacting the tech industry's skills supply
IT experts are the largest occupational group among those granted work permits in Sweden. Although most meet the salary requirement of SEK 34,200, occupational groups such as support technicians and operating technicians may be affected by the salary floor.
According to the committee's proposal, exemptions from the wage requirement can be made if an occupation is listed in the government's "shortage occupations list", This list should mainly be based on the Swedish Public Employment Service's forecasts, which are currently made for about 180 occupations.
The tech sector, which is a relatively young industry, encompasses many new job roles and skills. It is common for job titles to be in English and to change rapidly.
"It's important that we don't end up in a situation where applications are rejected because of a lack of forecasts for certain professions or skills," Ana says, adding:
"Dialogue with industry and employers will be crucial to ensure that the shortage list reflects actual skills needs".
Strategy to attract tech talent is missing
The inquiry has also been tasked with analyzing and considering measures to promote highly skilled labor migration. TechSverige does not believe that the proposals are sufficient.
"More ambition and policy efforts are needed to attract the best talent. Like Canada, the government should adopt a tech talent strategy, introduce six-year work permits and cap the processing time for tech work permits at 10 days," said Ana Andric.
International tech talent is important for Sweden
IT professionals are the largest professional group among those granted work permits in Sweden. They are not only important for the tech industry, but also for society as a whole.
According to the Confederation of Swedish Enterprise (2022), IT experts from third countries have generated approximately SEK 16 billion in value added, which corresponds to just over a third of the total contribution of labor migrants to GDP.
For the tech industry, the availability of international tech talent is crucial to maintain competitiveness in the global market. International recruitment is an important source to meet the skills shortage but also to be competitive globally. For Sweden to remain a leading digital nation, it is necessary to continue to welcome labor immigration, especially in the tech industry.
The inquiry New rules for labor immigration, SOU 2024:15