Member-only story
Why Socialist Sweden Has No Minimum Wage
Paradoxically, nation-wide minimum wages can be detrimental to countries where unions negotiate industry-wide salaries
Ah, Sweden. My home country. Well-known for its meatballs (that we don’t actually eat that often), its relentlessly cold and dark winters, and, of course, its diehard socialism. Yes, we probably have more vacation days than you. Yes, we have no tuition fees; on the contrary, we are paid to study. And yes, our taxes are as high as our caffeine intake. This is why you might be surprised to learn that we don’t have a minimum wage.
The minimum wage is a hot topic in the United States of America, where many people want it raised. It’s become a topic for the European Commission as well, which wants to make minimum wages mandatory for EU nations. Yet, Swedish unions are loudly protesting against minimum wages. They want nothing to do with it, much like I want nothing to do with pineapples on pizza.
To understand why the unions are against minimum wages, we must first talk about unions in Sweden. Unions are a dominating force in the Swedish job market. Nine out of ten Swedes work at a company that has a collective agreement, also called a union contract. Every year, unions in Sweden negotiate salaries across industries. Good salaries.
