Having high debts in relation to one's income is something that characterizes Swedish households. That has made many homes particularly vulnerable to rising interest rates and inflation in times of economic instability.
"Sweden stands out against comparable countries," says Mats Kinnwall, Chief Economist at Teknikföretagen.
But perhaps there is a glimmer of light in the new wage agreements – and upcoming relief for households.
Highest pay increase since 2008
The leading industrial agreements, which were set on April 1, announced a historically high wage agreement. In addition, an extra increase of SEK 1,350 in the agreement's minimum wages from 1 April 2023.
This represents the highest pay increase in two years since 2008. In practice, this means that the so-called debt-to-GDP ratio will decrease and households' debt situation will improve significantly in the future.
"The combination of households not borrowing as much and income growing reduces the pressure on households to be able to pay their loan debts in the future," says Mats Kinnwall.
Watch SVT's reporter Ulf Hambreus explain how the debt situation is improving in practice in the video above.