Government to review building capacity

After several industries, including construction companies, have reported labour shortages the government has announced that it will review the labour capacity within the construction industry to ensure that the increasing need for new housing is met.

Peter Eriksson, the (Green) minister responsible for housing, says “in order to be able to build more housing we need to ensure that there are enough people working within the construction industry, and preferably more women.” Eriksson also wants to make better use of new arrivals’ competence.

Return of grey economy jobs

The government’s 20% cut in the amount of tax that companies could deduct on ROT (home repairs) and RUT (household services) as of January this year have meant that the number of ROT jobs have fallen by 16% and companies within the home repairs sector predict that that it will continue to fall.

“We’re continually getting calls about companies that are worried. Some have had to cut staff. We’re also hearing that the number of grey economy jobs is on the increase,” says Maria Boborg Trané of the national association of SME:s (Småföretagarnas Riksförbund).

Building boom at risk

Banks’ new mortgage requirements on buying newly produced residential property and Brexit threaten to overturn forecasts for the building of new housing, warns Ola Månsson, MD of the Swedish Construction Federation (Byggindustrier, BI). The Federation said in its June forecast that the construction of 56,500 new homes will start this year, a clear increase compared to 47,300 new housing units last year.

At the same time the National Board of Housing, Building and Planning (Boverket) has said that 710,000 new homes will be needed over the next ten years, and 440,000 of these already by 2020. This means that an average of 88,000 new homes will need to be build every year.

Vattenfall committed despite losses

State-owned energy firm Vattenfall continued to post major losses in its Q2 report, with losses after tax for the first half of 2016 on a par with last year’s major losses. The company has also had to write down a further SKr 30 billion of the value of the company’s assets, of which the German lignite assets account for SKr 21 billion.

The losses would have been SKr 20 billion higher if Vattenfall had not sold the controversial assets in Germany, says chief executive Magnus Hall.

Vattenfall has also announced it will invest SKr 3 billion in a wind farm off the coast of Aberdeen, which US presidential candidate Donald Trump battled unsuccessfully in court to stop.

Despite not being Vattenfall’s largest facility, it will be very important in testing and demonstrating new technology for offshore wind power, said Hall.

Probe shows flaws in Nordea

Nordea’s internal probe into the Panama scandal reveals flaws in the bank’s Luxembourg operations and adds to concerns over potential mega fines and raised capital requirements. However, Nordea’s chief executive Casper von Koskull does not foresee that this will impact on dividend payment. He tells Dagens Industri (DI) that it is part and parcel of his job to ensure that Nordea’s errors are fixed.

Ericsson’s main shareholders want new boss

Two of telecom group Ericsson’s main shareholders, Investor and Industrivärden, have decided that the current chief executive Hans Vestberg needs to step down as soon as a replacement can be found, reports Dagens Industri, citing unnamed sources.

“The problem is that it can be difficult to find a suitable successor who would take the job. There are no internal candidates and the external candidates may be discourage by the situation in Ericsson,” a source told DI.

Both Investor and Industrivärden have declined to comment the information. Vestberg has been CEO since 2010.

Swedes slow to change bank

As many as 43% of all Swedes have never changed banks, shows a survey by Inizio, which notes that 34% of Swedish bank customers are satisfied with the conditions at their existing bank and are therefore reluctant to swap bank. One third of those who had changed bank said there was very little difference between their old and new bank and therefore hardly worth changing, while 24% said it involves too much red tape to be worth the effort.

Jan Bertoft, secretary general at Swedish Consumers’ Association, says too few switch allegiance and calls on the bank sector to simplify routines.

Good news for Riksbank

A TNS/Prospera survey published on Wednesday showed that inflation expectations five years ahead have risen from 1.8 to 1.9%, the highest level since the third quarter of 2013. Employer expectations rose from 1.9 to 2.0% while money market expectations remained unchanged at 2.0%.

Salary increase expectations rose 0.1 points to 2.3% over one year, to 2.4% over two years and 2.3% over 5 years. Nordea has commented that this is good news for the Riksbank.

According to the Riksbank’s own survey, firms are experiencing continued low price pressure and are finding it hard to raise prices despite relatively healthy demand.

CEO salaries keep rising

The chief executives of Stockholm’s top listed companies saw their salaries rise by on average 17% last year despite the drop of around 1% in the OMX Stockholm top 30 index during 2015. The overall costs for CEO salaries increased from SKr 753 million to SKr 885 million.

The CEO pay rises should prompt a debate on alternative forms of remuneration, writes DI and points to Jörgen Lantto at biometric company Fingerprint Cards, whose share price has surged by over 1,500%, but who is the lowest paid CEO among the top thirty.