Tech-savvy workers boost Nordic economies

Well-developed digital infrastructure helps these economies weather pandemic

STOCKHOLM:

Helen Balfors, a project leader at Norwegian conglomerate Orkla, has been working from home for longer than most of her colleagues after returning from a skiing trip to Italy in February as the new coronavirus took hold in Europe.

The mother of three said that while the company had always encouraged a good work-life balance, some managers had required their employees to be in the office before the pandemic hit.

“But now they realise it works just as well to be at home,” she said. “I just needed an extra screen and an extra keyboard from the office, which I got in a couple of days.”

Well-developed digital infrastructure has helped the Nordic economies weather the pandemic better than most of Europe. Britain’s economy contracted by around a fifth in the second quarter, Spain registered an 18.5% drop while the eurozone economy as a whole shrank 11.8%.

In contrast, Finland’s gross domestic product (GDP) fell just 4.5%, although Sweden and Norway saw larger hits of 8.3% and 6.3% respectively.

“Better digital infrastructure means we were quicker at being able to work from home. The infrastructure is there and we are used to using it,” said Robert Bergqvist, chief economist at Swedish bank SEB. “That has helped hold up production and consumption.”

Denmark, Sweden, Finland and the Netherlands had the most advanced digital economies in the EU in 2018, a research paper from the European Commission showed, based on connectivity, human capital, internet use and extent of e-commerce.

The Nordics – home to telecoms infrastructure firms Ericsson and Nokia – topped the EU table for home-working even before the pandemic.

Sweden, in first place, had just under a third of workers working from home, at least occasionally, in 2019, according to the European Foundation for the Improvement of Living and Working Conditions (Eurofound), an EU agency. The EU average was around 10%.

Long-term flexible employment practices, such as allowing parents to stay home with sick children, and emphasis on a healthy work-life balance have encouraged remote working. During the pandemic, around 60% of Finns have been able to work from home, around double the level in Spain. Sweden and Denmark are also well above the EU average of less than 40%, according to Eurofound.

A high proportion of information technology-focused jobs that lend themselves to distance working has helped but businesses and individuals have been quick to make the digital leap.

That, along with well-established rules for furloughing employees, means working hours have dropped less than in most of Europe – by 4.2% in Norway in the second quarter against a drop of 10.7% for the euro zone as a whole, Eurostat data shows. With workers retaining at least some income, household spending and consumption have held up well.

Eurofound’s survey showed around 70% of Swedes, Finns and Danes were optimistic about their future against just 45% across the EU.

 

Published in The Express Tribune, September 21^st, 2020

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