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1. The Committee took note of the Government's report for the period ending June 1996 and of the information it contains in reply to its previous observation. It also notes a communication in which the Swedish Trade Union Confederation (LO) comments generally on the report.
2. The statistical data supplied by the Government, supplemented by the data published by OECD, do not show any improvement in the employment situation during the period. The resumed economic growth in 1994 and 1995 was not accompanied by any increase in the volume of employment so as to compensate for the losses recorded since the beginning of the decade. Total employment fell further by 0.6 per cent in 1996 and the unemployment rate, after a slight drop in 1995, returned to the level of 8 per cent which it reached in 1993. In addition, about 5 per cent of the active population was engaged in a labour market policy programme in 1996. The Committee notes that unemployment seems to firmly stabilize at the high level reached during the earlier recession phase.
3. In this worrying context, the Government indicates that it has fixed its main priority as reducing unemployment by half by the end of the year 2000. It considers, however, that employment policy is restricted by the state of government finance and that sound national finances and stable prices are essential to achieve long-term sustained growth and higher employment levels. In this regard, the Government emphasizes that it is necessary to reduce the public deficit in order to lower interest rates. In the view of the Swedish Trade Union Confederation, however, although budgetary balance is being achieved, the maintenance of an extremely restrictive economic policy has contributed directly to shrinking employment and increased unemployment. The Committee, which notes that domestic demand has remained relatively static during the period, requests the Government to supply its own assessment of the impact of its budgetary stabilization programme on economic activity and, in particular, employment. More generally, it would be grateful if the Government would indicate whether, in view of the results obtained in controlling inflation and deficits, and also the persistence of a high unemployment level, it intends to review the main objectives of its economic policy with respect to its actual or expected impact on employment opportunities, in accordance with Articles 1 and 2 of the Convention.
4. The Committee notes with interest the substantial information provided by the Government on the implementation of its labour market policy. It notes that emphasis continues to be placed on the prevention of long-term unemployment in order to safeguard the employability of jobseekers and that new measures were to be implemented in 1997, including temporary employment programmes for the older unemployed, grants for women wishing to set up in business or education subsidies. The Committee requests the Government to continue to supply detailed information on these programmes and the evaluation of the results they achieve. In regard to young persons, the Government states that it intends to provide them with better training by delaying their entry into the labour market and encouraging higher education studies. The Committee requests the Government to continue to supply information on how its education and training policies are coordinated with employment prospects. Finally, the Committee notes the changes which were to be introduced in 1998 with respect to conditions of granting unemployment insurance benefit in order to promote active jobseeking. It would be grateful if the Government would continue to supply information on the measures taken with a view to providing better coordination between the unemployment protection system and the active employment policy, taking into account the relevant provisions of the Employment Promotion and Protection against Unemployment Convention, 1988 (No. 168), and the Committee's comments on their application.
5. With reference to its previous observations, the Committee notes the indications on the activities of the Advisory Council established in the Swedish National Labour Market Administration (AMS). It is bound to recall again that the consultations required under Article 3 of the Convention should not be restricted to labour market policy in the narrow sense but should be extended to all aspects of the economic and social policy which have an impact on employment. It hopes to find in the Government's next report information on how this important provision of the Convention is applied.