By JOÃO DOS REIS SILVA JUNIOR*
In the context of the structural transformations of the 21st century, the Swedish regulatory framework maintains invariance in certain labor rights in the face of economic pressures and social changes
One notable aspect that highlights the uniqueness of capitalism in Scandinavia is the debates between capital and labor that took place globally in the 1980s. This phenomenon manifested itself in the interaction between trade unions and employers in Sweden during this period, exemplifying how trade union pressures and employer counterpositions shaped not only the Swedish economy, but also international debates on labor, capital, and social justice.
During the 1980s, Sweden was involved in intense controversies over economic democratization, aligned with the social democratic model that encouraged tripartite dialogue between unions, employers and the State.
The Central Swedish Workers' Organization, the main trade union, led demands for greater worker participation in business management and ownership, materialized in the Meidner Plan (1976). The proposal provided for the creation of collective investment funds – called wage-earner funds – financed by taxation on corporate profits, with the aim of gradually transferring shares into the hands of workers and expanding their decision-making power.
Among the union goals were: reducing the concentration of wealth, equitable redistribution of productive gains, creating legal mechanisms for the acquisition of shares by unions via collective funds and guaranteeing seats on administrative boards – a practice known as codetermination.
In 1983, after intense debate, a limited version of the funds was approved with a 20-year term and restrictions on the acquisition of shares (limited to 7% of the stock market). However, the project was suspended in the 1990s due to intensified pressure from business leaders and the reconfiguration of the economic model towards neoliberal precepts.
The Confederation of Swedish Enterprise led such resistance, arguing that active worker participation could jeopardize both business efficiency and global competitiveness. Business leaders feared losing control over strategic decisions – such as investments and mergers – and suffering political interference in management.
Opposition to collective funds led to public campaigns that characterized them as instruments of “state socialism,” claiming that they posed risks to the autonomy of the business sector. At the same time, business groups increased their investments in political articulation to neutralize union initiatives, associating these efforts with warnings about massive disinvestment and the possible decapitalization of the country. This scenario strengthened the support of economic elites for neoliberal agendas, which began to advocate deregulation of financial markets, reduction of corporate taxation, and relaxation of labor laws as responses to pressure for distributive reforms.
The squeeze on business, coupled with fiscal crises and the phenomenon of globalization, culminated in Sweden's adoption of neoliberal reforms in the 1990s: privatization of state-owned enterprises; deregulation of the banking and financial sectors; and a significant reduction in the role of the state in social welfare. Financial liberalization led to property speculation and rising private debt. In 1991–1992, the collapse of the property market associated with the banking crisis resulted in a severe recession, with unemployment rates rising from 2% to 10%.
Although the funds earmarked for workers were abandoned, they left a significant legacy in discussions about economic democracy. Sweden preserved aspects of the social model, but became more receptive to market dynamics. The conflict exposed the struggle between collectivist approaches (represented by trade unions) and individualist approaches (defended by business). Global integration restricted the Swedish state's ability to pursue heterodox policies.
The so-called “Swedish paradox” in the neoliberal transition process that took place in the country continued to show high levels of social equality, demonstrating that market-oriented reforms can coexist harmoniously with social safety nets. This episode illustrates how pressures from trade unions combined with business reactions shaped not only the Swedish economy, but also global debates on labor, capital, and social justice.
The union agenda prioritized the deconcentration of wealth and the expansion of workers' decision-making power in the economic sphere, articulating the redistribution of profits as a mechanism to mitigate social asymmetries. As a strategy to materialize these goals, labor entities defended the institutionalization of collective funds, made possible by specific legislation, capable of allowing the acquisition of company shares and the inclusion of worker representatives in administrative boards – the aforementioned codetermination.
Os wage-earner funds (workers' funds) emerged as a structural instrument to increase labor influence in the economic sphere, with an emphasis on active participation in corporate decision-making processes. These funds, operated through the progressive acquisition of corporate shares, aimed to transfer part of the share capital to the collective control of workers, guaranteeing them seats on administrative boards and a voice in management strategies. At the same time, they sought to redirect the distribution of profits, mitigating socioeconomic asymmetries through reinvestment in professional training and productive infrastructure. Part of the resources were allocated to social protection programs – health, social security and assistance –, reinforcing safety nets for the working class.
The combination of shareholding, codetermination and redistributive policies was part of a broader project: to reconfigure economic power relations, linking productivity gains to concrete improvements in living conditions. Despite the ambitious scope, implementation was restricted to limited mechanisms, reflecting tensions between precepts of economic democracy and resistance from capital.
Structural conflicts between trade unions and business conglomerates had a profound impact on legislative dynamics. At the heart of the parliamentary clashes, the agenda of economic democratization – especially the demand for workers’ codetermination in corporate governance – polarized decision-making arenas, becoming a catalyst for ideological tensions. The LO, as a hegemonic trade union entity, mobilized efforts to ensure institutional support for wage-earner funds, a mechanism designed to redistribute shareholding power.
In contrast, SAF (Svenska Arbetsgivareföreningen), representing the business community, organized a coordinated resistance, describing the proposal as state intrusion incompatible with free market principles. Parliament thus became the stage for irreconcilable antagonism: on the one hand, projects for economic emancipation through labor participation; on the other, the uncompromising defense of traditional hierarchies between capital and labor. The virulence of the debate exposed not only tactical differences, but systemic contradictions inherent in the current accumulation model.
The Swedish Parliament has become the scene of heated debates, with the Social Democrats defending the union proposals and right-wing parties, together with various segments of society, voicing their opposition. These discussions highlight the tension between collectivist and individualist perspectives, as well as the search for a balance between economic efficiency and social justice.
In defense of and appreciation for workers, unions encouraged public and political debates with the aim of garnering support in parliament and among the general population. They included labor mobilizations through educational campaigns and public demonstrations, highlighting the need for a more equitable distribution of profits and a reduction in the concentration of capital.
As already mentioned, the union strategy involved defending codetermination – that is, the representation of workers on boards of directors – to ensure an active voice in business decisions. Furthermore, it emphasized the importance of strengthening social protection and labor rights as a means of promoting a fairer and more equitable economy.
The disputes between trade unions and employers' representatives during the period under analysis had a significant impact on the configuration of labor rights. The demand for greater worker participation in the governance and shareholding structure of organizations stimulated reflections on their inclusion in decision-making bodies, with an emphasis on the discussion of models of corporate codetermination. At the same time, the negotiations directly influenced the criteria for allocating surpluses, expanding the debate on equity in the division of profits between investors and the workforce.
Ultimately, pressure from business leaders and changing global economic dynamics led to the adoption of neoliberal policies in the 1990s, resulting in significant reforms in the Swedish economy: the normative destructuring of financial circuits and the institutional erosion of labor contractual guarantees.
In other words, the reconfiguration of the Swedish labor market, aligned with the neoliberal guidelines consolidated in the 1990s, introduced structural modifications aimed at economic adaptability and systemic competitiveness.
In this context, the progressive easing of regulatory rigidity stands out, facilitating hiring and termination processes, as well as the expansion of atypical employment modalities, such as temporary contracts and part-time work. Such measures have allowed corporations to dynamically adjust their production teams in response to fluctuations in demand, aiming to optimize operational efficiency.
At the same time, there was a progressive deregulation of wage-setting mechanisms, establishing variable criteria linked to individual productivity and sectoral performance.
The flexibility paradigm also catalyzed intersectoral labor mobility, through public professional training policies and assisted transition mechanisms between economic segments.
Although these reforms have increased competitiveness and economic efficiency, they have also brought to light significant challenges, such as precarious working conditions and job insecurity for certain segments of the population. Labor market liberalization sought to balance the need for economic growth with the preservation of workers' rights.
The emergence of a precariat in a context historically linked to social-democratic pacts exposes contradictions of late capitalism. Dynamics triggered in the 1990s by means of neoliberal reforms reconfigured labor and economic structures through three vectors: the flexibilization of the labor market, economic deregulation, and the privatization of state-owned companies.
These changes institutionalized mechanisms of occupational insecurity, converting social rights into volatile commodities. The progressive erosion of stable employment and the naturalization of productive instability reveal the transmutation of welfare state in a hybrid model, subordinating collective protections to commercial rationality.
With this flexibilization of the labor market, temporary and part-time contracts emerged, resulting in greater job insecurity for many workers. Economic deregulation led to an intensification of precarious working conditions, characterized by reduced protections for workers and increased wage variability depending on individual productivity.
The reconfiguration of assets through the transfer of state assets to the private sector resulted in the elimination of historically stable jobs paid according to collective standards, increasing the contingent subject to structural precariousness.
The financial collapse of the 1990s acted as a catalyst for this dynamic, establishing recurring cycles of socioeconomic vulnerability that laid the foundations for the quantitative expansion of the precariat. Recent data indicate that around 15% of the national workforce is currently included in this category, constituting a paradigmatic rupture in the traditional balance between market efficiency and social protection characteristic of the Swedish model.
The emergence of precariat in Sweden has manifested itself in multiple sectors of the economy, with variations in the proportions of workers in precarious employment situations. In the services sector, there is a high concentration of these workers, especially in the areas of commerce, hotels and restaurants; seasonal characteristics and fluctuations in demand in these segments are factors that contribute to the precariousness of work.
In the construction industry, there is also a high rate of temporary workers or workers with partial contracts, due to the cyclical nature of projects and the constant need to adjust the workforce to emerging demands.
Although the industrial segment records lower rates of job insecurity in contrast to the services and construction sectors, atypical contractual arrangements persist – such as part-time work and temporary contracts – particularly in industrial sectors subject to production fluctuations.
In the agricultural sector, the predominance of seasonal workers derives from the intrinsic seasonality of agricultural activities and the cyclical demand for additional labor during critical production phases. These sectors are configured as structuring cores of the precariat in the Swedish context, expressing both sectoral specificities and the cumulative effects of policies aimed at the progressive deregulation of labor relations. The convergence between local economic particularities and neoliberal precepts of regulatory flexibility thus consolidates a scenario of precarious heterogeneity in the labor market.
In the context of the structural transformations of the 21st century, the Swedish regulatory framework maintains the invariance of certain labor rights in the face of economic pressures and social changes. Guarantees such as the minimum period of five weeks of annual paid vacation remain non-negotiable, regardless of economic fluctuations. Paid parental leave remains an institutional framework, ensuring the continuity of employment relationships during the period of parental care.
At the same time, collective bargaining remains central to the mediation of labor disputes, ensuring the preservation of basic rights through tripartite consensus. Regulations for the protection of physical and mental integrity in production environments are strictly enforced, resisting deregulatory trends. These normative pillars constitute critical elements for sustaining civilizing standards in the world of work, operating as institutional antidotes against the complete erosion of social achievements in the face of neoliberal hegemony.
Also of great importance is the fact that trade unions continue to be organised in Sweden. Trade union density remains high, although there are growing gaps related to social category and national origin. Trade unions play a crucial role in labour relations by negotiating collective agreements and defending workers’ rights. The “growing gaps” refer to disparities in the representation and protection of workers, which vary according to their social category or national origin.
These gaps are evident in sectors where union density is lower, such as among white-collar workers, immigrants and temporary workers; these groups often face greater challenges in organizing and negotiating better working conditions.
Precariat in Portugal
The concept of precariat in Portugal, which refers to a segment of the working class that emerged after 2008 and is characterized by precarious employment with unstable and unprotected working conditions, has become increasingly relevant in the current sociopolitical context. The transformation in labor relations and the increasing flexibility of the labor market have increased the number of workers in precarious situations, characterized by uncertainty, lack of solid labor rights, and socioeconomic vulnerability. In this scenario, the role of unions and state intervention become essential to mediate relations between capital and labor, seeking to minimize the negative effects of precarious employment.
Trade unions in Portugal have played an important role in defending the interests of precarious workers. Historically focused on protecting employees with stable contracts, unions have been adapting to include in their agendas the fight for the rights of this new segment of the working class. This adaptation is a necessary response to the fragmentation of the labor market, where temporary, part-time and informal jobs are becoming increasingly common.
Union action seeks to expand collective bargaining, pushing for policies that ensure greater job security, better working conditions, and access to essential rights such as health care and social security. However, the representation of precarious workers still faces significant challenges, such as difficulties in collective organization in an environment marked by high turnover and informality.
State mediation in labor relations between capital and the precariat is also crucial. By formulating appropriate public policies and legislation, the State can directly influence working conditions and the distribution of rights among different segments of the workforce. In Portugal, labor laws have been the subject of dispute between the interests of capital – which seeks to maximize flexibility and reduce costs – and workers’ demands for security and social justice.
Programs aimed at supporting employment, professional training and protective measures are some of the tools used by the State to mitigate the impacts of precarious employment. However, the effectiveness of these initiatives is often limited by the logic of the capitalist system that prioritizes financial accumulation over social well-being.
Globalization and intense international competition place additional pressure on local labor markets, making it difficult to implement effective policies to protect the precariat. In addition, economic crises, austerity measures and budgetary constraints reduce the capacity of the State to act as an efficient mediator. These factors contribute to maintaining a scenario of instability and inequality in which workers in precarious conditions are the most affected.
Despite the efforts made by unions and the State, there are major challenges to combating precariousness. The disparity of power between capital and workers in this vulnerable situation – combined with the resistance of business sectors to necessary changes – as well as economic volatility are obstacles that hinder more significant progress. In this context, solidarity among workers, social mobilization and political awareness emerge as essential elements to strengthen this resistance against the phenomenon of precariousness. The construction of solidarity networks and pressure for structural reforms become necessary ways to address the inequalities generated by precariousness.
Therefore, the future of labor relations in Portugal will depend on the ability of unions to adapt to the new realities of the labor market, combined with the state's willingness to implement policies that reconcile economic interests with social justice. Only through a collaborative approach involving unions, government and civil society will it be possible to ensure that the rights of precarious workers are duly recognized and protected. Combating precariousness goes beyond labor issues; it is also an ethical and social imperative towards building a more just and equitable society.
When comparing the Swedish and Portuguese precariat, similarities can be identified, such as temporary and part-time contracts, job insecurity and dependence on social benefits. Both countries face challenges linked to precarious work, particularly in the service, construction and agriculture sectors.
However, there are notable differences: in Sweden, the welfare system is more robust, providing a wider net for precarious workers; while in Portugal there are less comprehensive support programmes for social protection. Furthermore, the higher union density in Sweden may offer more effective representation in defending labour rights.
Wherever it exists, there is no doubt that the precariat is a consequence of capitalist exhaustion that destroys in order to accumulate wealth.
Obviously, studies on the global precariat must consider the cultural specificities inherent to each country; however, there is still a huge lack of research that analyzes this issue considering the particular national cultures involved.
By the way, the dynamics of the class struggle in Brazil – including the precariousness of work – differ greatly from those observed in Portugal and, even more so, in Sweden. So who is willing to continue unraveling this thorny issue?
*João dos Reis Silva Junior is a full professor in the Department of Education at the Federal University of São Carlos (UFSCar). Author of, among other books, Education, Class Society and University Reforms (Associated Authors) [https://amzn.to/4fLXTKP]
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