How technology can boost Sweden's productivity
Productivity growth in Sweden has almost halved since the beginning of the 2000s. At the same time, Sweden and Europe find themselves in an increasingly uncertain global situation, characterized by geopolitical unrest, tougher global competition, and rapid technological development. In this situation, digitization and new technology, not least AI, open up opportunities for major efficiency gains and increased resilience. In its response to the Productivity Commission's proposal, TechSverige welcomes several of these, but emphasizes that Sweden needs better conditions to actually introduce and utilize new technology throughout the economy.
TechSverige welcomes the Productivity Commission's reportsGood Opportunities for Increased Prosperity (SOU 2024:29)andMore Opportunities for Increased Prosperity (SOU 2025:96)and shares the Commission's conclusion: higher productivity is crucial for Sweden's long-term growth, competitiveness, and welfare. At the same time, TechSverige emphasizes that the tech industry is already a key driver of productivity—both as an industry in its own right and as an enabler in other industries and the public sector.
In 2024, Swedish tech companies produced goods and services worth over SEK 1,100 billion, contributing nearly SEK 340 billion to GDP. The industry employs around 263,000 people in over 60,000 companies and accounted for nearly SEK 390 billion in exports, approximately 11 percent of Sweden's total exports.
"If Sweden is to reverse the productivity trend, we need to pick up the pace of digitalization and AI, both in the business sector and in the public sector. The tech industry is a growth engine, but also an accelerator for efficiency and innovation throughout the economy," says Christina Ramm-Ericson, chief economist at TechSverige.
As global competition intensifies, Sweden needs to be at the forefront of developing and using new technology.
In its response, TechSverige welcomes several reform tracks, particularly regulatory simplification and more efficient licensing processes. Regulatory burdens, fragmented regulations, and unclear application, particularly with regard to EU regulations on data, AI, cybersecurity, and digital infrastructure, risk slowing down investment and the introduction of new technology. Administrative requirements must not hinder the use of technology. TechSverige also highlights the need for Sweden to push for regulatory simplification earlier in the EU legislative process, with a focus on proportionality, technology neutrality, and theThink Small First principle.
TechSverige also emphasizes that digital infrastructure and connectivity need to be treated as a more distinct part of the transport infrastructure, and that the public sector has great potential for productivity gains through digitization, automation, decision support, and AI, not least by reducing administration and freeing up time in core activities.
In the section on research, development, and innovation, TechSverige shares the Commission's focus on investing in broad framework conditions rather than targeted support, but calls for a clearer level of ambition for public investments.
"As global competition intensifies, Sweden needs to be at the forefront of developing and using new technology. Increasing government funding for research and innovation to at least 1.2 percent of GDP is a crucial step toward enabling technological advances and strengthening productivity growth over time," says Christina Ramm-Ericson.
Overall, TechSverige points out that the Commission's reforms could have a major impact – but that implementation must ensure faster introduction of new technology, better skills provision, and a clear division of roles, with the public sector primarily facilitating and procuring market solutions.