The COVID-19 pandemic severely impacted the labour market. Many were furloughed or lost their jobs. The authorities implemented measures to counteract the negative effects of the pandemic. Fafo, in collaboration with researchers from the universities of Gothenburg and Aalborg, is conducting studies across Scandinavia on the crisis's impact on the labour market, its institutions, and workers' attitudes towards the measures implemented.
Several questions are addressed in the project: Which groups lost their jobs and bore the burdens? A paper from 2025 compares the pandemic years with previous downturns. Unemployment rose sharply during the pandemic and increased more for low-income groups than for higher-income individuals, as in previous downturns. However, existing disparities in the Norwegian labour market were exacerbated more during the pandemic than in previous crisis.
Additionally, we have examined whether wages are adjusted downwards, i.e., if they are flexible, during downturns in the Norwegian labour market. Preliminary results suggest that wages are more flexible in companies with collective agreements than in companies without such agreements. This may contribute to downturns having less negative consequences for employment in companies with collective agreements.
Which measures were implemented, and why? An article from 2024 examines how unemployment and sickness benefits were changed in Scandinavia during and after the pandemic. While Denmark and Norway implemented temporary changes that strengthened existing schemes, many of the changes implemented in Sweden became permanent. In Sweden, the pandemic contributed to the implementation of changes that had been debated for some time. A paper from 2023 shows how income security for the self-employed was altered during the pandemic. Changes were made under time pressure, in close cooperation between authorities, employee and employer organisations, in all three Scandinavian countries. Path-dependent temporary changes were made to income security schemes in Denmark and Sweden. Additionally, Denmark implemented a temporary wage compensation system. In Sweden, the rules of the existing system were made more flexible and accessible, and the adjustments made had lasting effects; the income security scheme, which was on the verge of being tightened before the crisis, is now instead available to more people. In Norway, the government and parliament, together with the social partners, came up with a temporary income security system. A chapter from 2024 examines how the furlough scheme was changed in Norway and finds that several well-known and innovative changes were made to the existing scheme. New solutions were developed due to the pandemic and because of the state's COVID-19 lockdown. An article from 2025 compares how furlough schemes, short-time work schemes, and wage compensation schemes were changed and introduced in the Scandinavian countries. The schemes in Scandinavia became only slightly more similar to each other.
Did the authorities, employer and employee organisations (the social partners) in Scandinavia, despite differences in the degree of cooperation before the pandemic, manage to create good solutions under pandemic pressure? We do not find examples of tripartite solutions where coordination occurred between different policy areas. However, several changes and new measures were implemented in close cooperation between employer organisations, employee organisations, and the state. For example, the article on job retention schemes from 2025 shows that both previously used adjustments to the furlough scheme and new solutions were characterised by cooperation between the social partners to solve common challenges. The study of changes in unemployment and sickness benefits in Scandinavia, and the study of changes in income security for the self-employed, do also show that the social partners were involved, and that their involvement was closely linked to whether the social partners themselves had vested interests in the scheme.
Finally, we examine how the crisis affects different groups' attitudes towards various crisis changes. A paper from 2024 studies individuals' attitudes towards changes made to the unemployment benefit system in Norway during the pandemic, and we ask whether self-interest or more general ideological beliefs shape perceptions of the changes made. The paper suggests that attitudes towards these changes are largely shaped by individuals' experiences in the labour market during the pandemic. This is more important than individuals' current attachment to the labour market. A paper from 2025 examines attitudes towards adjustments to the furlough schemes in Denmark and Norway, and attitudes towards this seems to be influenced by individuals' experiences with the crisis at their own workplace. Further, we find a political divide in attitudes in Denmark.
Cooperating with researchers at the universities of Gothenburg and Aalborg, we will compare how the Danish, Norwegian and Swedish labour markets and their governance models tackle and adjust to the consequences of the corona epidemic. Applying a multi-level, multi-method approach, we compare the crisis’ impact, and the policy responses and adjustments to it as it unfolds in time. Scandinavian labour market institutions and actors share many similarities, but regulations differ in important ways as do the national responses to the epidemic. Combining register and survey data, document analyses and qualitative interviews, the project builds on five work packages (WP). The core questions in WP1 and WP2 are how the economic shock affects the pattern of labour mobility, wage sensitivities, and the distribution of employment and earnings. WP3 examines to what extent the Scandinavian capacity for crisis management through coordination of economic policies, wage setting and social policies remains intact, and the role of social dialogue in shaping eventual reforms in labour market policies and institutions. WP4 analyses changes in specific policy instruments and institutions, such as temporary lay-off schemes and employment regulation, and how the adjustment paths are influenced by national differences in the depth of the crisis or the extent of policy concertation. Finally, WP5 studies attitudes and preferences of individuals in different labour market positions, their support for or disapproval of different policy schemes and changes. A research challenge could be the access to central representatives of governments and organized actors in WP3-4, but the research team has longstanding experience in research cooperation with such actors. WP5 requires information from surveys that, provided national funding in Denmark and Sweden, require coordination across countries, but researchers involved in this project have extensive experience with this type of data collections.
