Swedish economic history: 1945-1969

1945 finally marks the end of World War II. Large parts of Europe lie in ruins. For six years, almost all resources have been spent on the military. Now it's time to rebuild all the things that have been destroyed, and finally it's possible to buy new things, have fun, and to invest in the future again. Sweden was neutral during the war, and so Swedish industry stands unharmed.

Demand from Europe gives Swedish companies the opportunity to produce, sell, and grow fast. Sweden exports both raw material, such as timber and iron, and refined products from its industries. During the war, fewer people chose to have children in Sweden, but now, when the war is over, people make up for that, and with gusto. The years 1945 to 50 bring a baby boom. More children are born than for many years.

Development toward fewer and fewer people working in agriculture and fishing continues, and the importance of industry further increases. In Sweden there are several successful shipyards. Here they build and repair many of the large ships needed to transport goods traded between the continents. The shipyards provide a large proportion of the job opportunities in Uddevalla, Malmö, Karlskrona, Göteborg, and many other places along the coasts. Besides the shipyards, there are several other industrial companies with many employees: ASEA...

LM Ericsson... Volvo... Saab... ... and SKF. These are good years for the Swedish economy.

Each year is better than the last; and life as a Swede becomes richer, safer, and more comfortable. The government is headed up by the Social democrats, either on their own or in a coalition with some other parties, throughout this entire period. The Prime minister is Tage Erlander. Their policy is focused on reforms: Longer vacations, more protection for workers' rights, higher pension benefits, daycare for small children, and more school for older children. The state becomes increasingly involved in people's lives: to help them, and to influence them toward a lifestyle that the state judges to be for the common good.

Sweden becomes a welfare state. Perhaps this is what the former party leader for the Social democrats, Per Albin Hansson, talked about, back in 1928, when he talked about Folkhemmet - the people's home. There are several reasons why Sweden is doing so well during this time. It's not only the strong demand from Europe after the war... Sweden is also benefitting from increased free trade, that is, a reduction in tariffs and other things limiting import and export.

Salary levels in the Swedish economy are stable. Thanks to the Saltsjöbaden agreement, there are few conflicts between employers and workers. Sweden also benefits from how the population is composed - from its demography. When the large numbers of children born right after World War II, finish school, the majority of the population is of working age. There are proportionately fewer children and elderly in Sweden, who need to be supported with tax resources.

In addition Sweden - like Finland - is one of the first countries where women enter the workforce in large numbers. This adds to the fact that such a large section of the population are gainfully employed, that is: have a job, earn a salary, and pay tax. The Swedish economy performs so well now, that there aren't enough Swedes. Sweden draws people from Italy, Greece, Finland, Yugoslavia, Turkey... that are needed as workforce in industry.

Sweden has gone from being a country of emigration to a country of immigration. These years, from the end of World War II, up until the end of the 1960's, are called the record years. During the record years, Sweden's economy is growing fast, and now, Sweden is a rich country. Sweden has among the highest standard of living in the world. Many countries are inspired by Swedish politics, and start to talk about the Swedish model.