As the cost of living across the globe continues to climb, we ask whether Sweden is still an affordable and desirable destination country, for both employer and assignee…
Cost of Living
The majority of general living costs in Sweden have gone up. From food, petrol and public transport to Netflix subscriptions and gym memberships. Bank loans have doubled. Electricity prices have skyrocketed: many residents have gone from paying 4081 – 5442 SEK/month to 16326 – 17686 SEK/month. As a result of this price hike, many landlords are now excluding electricity from accommodation packages, meaning that assignees are having to cover this utility cost themselves. The government had been providing financial support, but this only covered a proportion of the total cost, plus it ceased in January 2023.
Standard of Living
However, it isn’t all doom and gloom. The standard of living in Sweden remains very high. Key elements of daily life such as public transport, childcare and prescription medicines are heavily subsidised, meaning that whilst residents are losing money in one area, they are making substantial savings in another. Furthermore, the cost of living in Sweden is still much lower than it is in many other countries. For example, it is 21% lower than it is in the UK, 31% lower than it is in the US, and 77% lower than it is in Singapore. Transportation will cost you 31% more in the UK, personal care will cost you 68% more in the US, and housing will cost you 148% more in Singapore than it will in Sweden (Source: Expatistan)
Initiations continue apace
The K2 Sweden Team report that in spite of the increase in the cost of living, initiations are not dropping off. Although the cost of specific products/services/utilities can vary significantly from country to country, the increase in the cost of living is a global phenomenon. Therefore, there is no reason for companies to reduce the number of employees that they send to Sweden on account of it; in many cases, the cost of living is higher in their home country than it is in the destination country. In addition, within the assignee population as a whole, the desire to relocate to Sweden hasn’t diminished; the prospect of moving to a country with such a high standard of living remains a powerful incentive.
Clarity around Costs
According to the K2 Sweden Team, given the global nature of the cost of living increase, companies are not providing assignees with any form of additional, in-country support. (Assignees may, however, have their salary adjusted prior to their relocation to compensate for a higher cost of living in Sweden.) For the team, this makes it more important than ever to be absolutely clear about costs when communicating with assignees who are relocating to Sweden. This helps assignees to develop a solid understanding of where their money needs to go, ensuring that they remain comfortably within budget for the duration of their assignment.
