2023 POLICY ROADMAP

The Swedish economy entered recession in 2023, with GDP per capita expected to fall by 1.2% over the year. Even though inflation has been falling, it remains well above the target of 2%, leading the Riksbank to continue to increase interest rates and dampen economic activity. The number of bankruptcies has risen to the highest levels in Sweden recorded over 20 years.

2023 Framework Conditions Review1

In 2023 Sweden joined the group of high-income developed North American and European economies which had seen the national-expert-assessed quality of their entrepreneurial environment slip from sufficient to less than sufficient since the pandemic.

The quality of that overall environment is distilled in the National Entrepreneurial Context Index (NECI). In 2021 Sweden had a NECI score of 5.3, declining to 5.0 (just sufficient) in 2022 and then to a less-than- sufficient 4.7 in 2023.

Just two years ago, Sweden had six of its 13 Entrepreneurial Framework Conditions (EFCs) scored as sufficient. By 2023, this had fallen to four, with Ease of Access to Entrepreneurial Finance and Ease of Entry: Market Dynamics no longer regarded as sufficient, both having experienced large falls in their scores from 2022. In fact, between 2022 and 2023, 10 EFC scores fell, with scores increasing in just two.

National experts assessed the quality of social support for women entrepreneurs, and their access to resources compared to their male counterparts (new 2023 questions). For social support for women entrepreneurs, Sweden scored a creditable 6.1, fifth among all the GEM economies, but for access to resources the score was just 5.1, or 25th among GEM economies. Sweden was part of a select group of 10 economies with scores for social support that exceeded their scores for access to resources. Interestingly, six of these economies were from Northern Europe, with the other four from the Arabian Gulf.

2023 Entrepreneurial Activity Review

In 2023, one in four Swedish adults reported that their household income had fallen in 2023, down from two in five the previous year.

The entrepreneurial landscape is reasonably visible in Sweden, with just over one in two adults knowing someone who had recently started a business, and just under one in two adults considering they had the skills and experience to start a business themselves. Nearly seven out of 10 adults saw good opportunities to start a business locally, but two in five of these would not start a business for fear it might fail. Around one in 10 of Swedish adults not starting or running a business expect to do so in the next three years.

The level of Total early-stage Entrepreneurial Activity (TEA) in Sweden in 2023 was just under one in 10 adults, a level that has been consistent over the past three years, and a little higher than pre-pandemic. The male rate was well above that for females, implying that three men were starting or running a new business in Sweden for every two women doing the same. The level of Established Business Ownership was around 5%, meaning that there were two adults starting or running a new business for every adult owning an established one.

One in two new entrepreneurs agreed with the motivation to build great wealth or very high income, while two in five agreed with making a difference in the world. One in three new entrepreneurs had customers outside Sweden, while two in five expected to use more digital technologies in the next six months. About one in six of those starting or running a new business expected to employ at least another six people over the next five years, a rate twice that of two years ago.

1 A brief description of the GEM approach is given in the footnote on p. 107 of the GEM Global Report.