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Youth unemployment soars in Sweden despite stabilizing economy

People enjoy the sun set and the view of the Oresund Bridge from a view point outside Malmo, Sweden on the July 1, 2020. The bridge, which connects Sweden and Denmark, celebrates it's 20th birthday on Wednesday. Johan Nilsson/TT News Agency/via REUTERS/Files

STOCKHOLM (Reuters) - Youth unemployment in Sweden hit its highest level this century in July due to the widespread economic disruption caused by the coronavirus pandemic and measures to halt its spread, figures from the Statistics Office showed on Thursday.

Sweden’s economy has been less badly hit than many by the pandemic, partly due to its less draconian lock-down. But companies have nevertheless radically cut staff, often focusing on workers on temporary contracts, many of them young people.

Among those aged 15-24, the unemployment rate increased to 28.9% on a seasonally adjusted basis in July from 19.8% a year earlier, Statistics Office figures showed.

Youth unemployment has long plagued Europe and pandemic has raised fears of lost generation which could struggle to get a foothold in the labour market as they grow older.

Despite Sweden’s generally strong economy in recent years, it has been among those countries where youth unemployment has been stubbornly high - around 20% percent since 2000.

But July’s figure was the worst figure for more than 20 years, topping the 27.8% hit in 2009 amid the global financial crisis.

Overall, the labour market was steady in July amid signs the worst is over for the economy, with the seasonally adjusted unemployment rate at 9.2 percent, unchanged from the previous month.

Total employment stood at 5.150 million people, up from 5.101 million people the previous month.

Reporting by Simon Johnson; editing by Niklas Pollard

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