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PRESENTED BY AKADEMIKERNAS A-KASSA

Swedish income insurance: how does it work and do you need it?

You may have arrived in Sweden with a fair idea of its strong social support systems. But what do you know about its a-kassas?

Published: 1 October 2020 12:09 CEST
Swedish income insurance: how does it work and do you need it?
Photos: Anna Wright, Akademikernas a-kassa/Getty Images

A-kassas (short for arbetslöshetskassa) are unemployment funds that pay income-related insurance benefits. It’s a topic well worth taking the time to understand amid the coronavirus pandemic – especially with more generous temporary rules currently in place (more on this below).

We invited readers of The Local to send in questions for Anna Wright, of Akademikernas a-kassa, Sweden’s biggest income insurance provider for university graduates. Here, she explains the key things you need to know and responds to questions you sent us on Facebook and via email. 

Find out more about securing your income by joining Akademikernas a-kassa

Q: What’s the difference between an a-kassa and a union (fackförening or just ‘fack’ in Swedish)? Can you join an a-kassa even if you’re not a member of a union?

Anna Wright: It’s not a requirement to be a member of both a union and unemployment insurance fund (a-kassa), but we always recommend you join both. Here’s the difference:

  • You can get money from an a-kassa if you become unemployed.

  • From a union, you can get negotiating help, salary statistics, advice on employment law, a review of your CV or LinkedIn profile and more.

If you’re a member of both, you can also get income insurance that covers up to 80 percent of your entire salary if you lose your job. The benefit from the income insurance is paid by the trade union – but it’s always based on our decision on unemployment benefit (which we pay). 

Q: Is it mandatory to be a member of a union and an a-kassa to be able to get 80% of your salary in case of unemployment?

AW: It depends on how much you earn. In 2020, you can receive up to 80 percent of 33,000 Swedish kronor from the unemployment insurance fund. We always recommend that you join a union for the reasons above.

Q: What do I need to know about the temporary rules on unemployment benefit introduced in 2020 due to coronavirus?

AW: A number of temporary changes were agreed by the Swedish Government and supporting parties earlier this year in response to the economic impact of the pandemic. The key changes are: 

  • Increased maximum benefit: the highest benefit level is 80 percent of your income up to 33,000 kronor per month and the maximum benefit per day is now 1,200 kronor before tax for the first 100 days of unemployment.

  • No waiting period: unemployment benefit will be paid out from the first day of unemployment, rather than after a six-day waiting period.

  • Shortened membership requirement: you could qualify for up to 80 percent of your salary after being a member for just three months from March to December 2020 (compared with 12 months if you applied before April 13th 2020)

These rules are due to expire after January 3rd 2021. A potential extension to the higher compensation levels beyond this date is being discussed. But the rest will go back to ‘normal’ with the qualifying period reintroduced, meaning you will then need to have been a member for 12 months to receive compensation based on your salary. You can find full details here. 

Q: I’m self-employed. Why join an akassa?

AW: Many university graduates choose to go their own way and start a business. But there’s always a risk that your company will not be profitable. If you then end up needing to claim unemployment insurance, what you receive will be based on your higher earnings – whether that was as an employee or as an entrepreneur. This applies so long as you become unemployed within 24 months of finishing as an employee – otherwise, we will base the benefits on the period in which you had your own business.In Sweden, it’s actually almost 50 years since the self-employed were given the right to join an a-kassa! 

Secure your income now by joining Akademikernas a-kassa

Q: Can I become a member although I’m not working and I’m new to Sweden?

AW: You can join an a-kassa as soon as you start to work and pay tax in Sweden.

Photo: Getty Images

Q: Why is Akademikernas a-kassa’s fee changing to 140 kronor per month in October?

AW: The fee was adjusted to reflect the higher costs associated with offering a more generous daily allowance. This allowance was increased from 910 kronor to 1,200 kronor in March to mitigate the economic consequences of the coronavirus pandemic for individuals and society. Benefits from a-kassas are financed by membership fees and employer contributions. And when 75 percent of our unemployed members get higher daily allowances, we need to contribute more to the government cost. 

We’ve had an exceptional year, with 40 percent more applications for benefits. We’ve also had around 50,000 new members join us and we’ve still been able to maintain our processing times for applications to join. 

Q: I live in Sweden and pay Swedish income tax but commute to London, where I start and end my flights as cabin crew for an airline. I’ll be furloughed in October and I’m wondering if I’m eligible to pay into an a-kassa?

AW: First of all, do you have a Swedish work permit – that is, are you able to work for a Swedish employer? Second, is your employer paying Swedish social security costs (arbetsgivaravgifter)? If the answer to both these questions is ‘yes’ you should be able to join a Swedish a-kassa and get unemployment benefits if your employment ends, provided you fulfil the normal requirements.

Q: Finally, one Facebook comment encouraged people to save money themselves instead of joining an a-kassa, which the reader claimed may not pay out when needed. Another reader quickly disagreed! So, what does the expert say? 

AW: We’re sorry you feel that way about the a-kassa system in Sweden. All the a-kassas have the same rules and if you fulfill the requirements you will get your benefits. If you become unemployed you can get up to 26,400 kronor before tax per month – and you’d have to save your membership fees for quite some time to get that amount of money.

Whether you’re employed or an entrepreneur, find out more about protecting your income by joining Akademikernas a-kassa as a university graduate 

 

 
For members

PROPERTY

Should you buy a home in Sweden this summer?

Considering the fickle trends in the Swedish housing market, prospective homebuyers might find themselves at a crossroads this summer.

Published: 4 July 2024 14:41 CEST
Should you buy a home in Sweden this summer?

After a period of falling prices driven by increased interest rates, the Swedish housing market is seeing a rebound, particularly in the biggest cities.

However, it’s also taking longer to finalise home sales.

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Recent data from Swedish property listings site Hemnet indicates that while home sales – and housing prices – are on the rise, the time to complete transactions has notably increased.

For instance, the average sale time for an apartment in Sweden increased to 27 days in the first half of the year, up from 22 days during the same period last year. Similarly, houses now take an average of 31 days to sell, compared to 30 days previously.

The slowest market is in the Gävleborg region, where it takes an average of 44 days to sell a home. The fastest transactions occur in Stockholm, with apartments selling in just 16 days and detached homes in 23 days.

This variation in market activity across the country calls for a deeper look into where the best opportunities might lie for homebuyers this summer.

Renewed market confidence in Sweden’s biggest cities

The confidence in the Swedish property market is on its way up in Stockholm, Gothenburg, and Malmö, Erik Holmberg, a market analyst at Hemnet, told The Local.

“I would say that we have seen a weaker market in the last couple of years, almost everywhere in the country, since the Swedish central bank started to increase the interest policy rate, which affected the market a lot,” he said.

“But in the last half of the year or rather in the last year, the confidence has come back in bigger cities – in Stockholm, Gothenburg, Malmö… When we look at price developments last year, in three of Sweden’s biggest cities, we see prices increasing again.”

However, the analyst warned that the opposite is currently true in other areas of the country, which have seen a continued decrease in market activity and flatter developments in the same time interval.

A new trend emerging in Stockholm?

As Hemnet’s analyst explained, in Sweden, housing market trends usually start in Stockholm, when the market begins to change, causing a ripple effect.

“And that’s what we have seen. Now, market activity and prices are increasing again in the bigger cities. Usually, when the market changes, other areas in the country follow, and that could be the case now,” said Holmberg.

“When the rates and inflation situation become clearer, other parts of the country might follow the market in the big cities. Our main scenario is that we will see this spread,” he said, adding that prices in Stockholm have picked up quite fast in the last year but that the demand is still affected by the high interest rates.

“I wouldn’t be surprised if we saw swift price developments in some areas with the highest demand, such as city centres.”

The effect on the rental market

Another aspect to consider is the rental market, which could see significant changes in the short to mid-term.

Holmberg pointed out that properties which fail to sell might enter the rental market.

“What we’ve seen is that it’s harder to sell properties today, so, probably, more people who own homes and can’t sell them will put these unsold homes on the market for a while. This could affect the supply of apartments for rent and, in turn, prices,” the analyst said.

INTERVIEW:

What different types of homebuyers should know

For buyers, the current market presents a mixed bag.

“In Sweden, we often talk of having a seller’s or buyer’s market. Today, it’s good for buyers that they have a lot to choose from; there’s a record-high supply almost everywhere in the country. That means it’s easy to find something,” said Holmberg.

However, he also cautioned that the slow market makes agreeing on terms with sellers challenging, with sales times at record highs.

“Sales take some time in today’s market, and that’s important to understand for both sellers and buyers, especially for homeowners who are changing homes, meaning they’re both buying and selling something; it’s a tough market for them.

“Today, this group often chooses to sell their home before they buy something new. That makes up a big part of record high sales times; we have people waiting for the right bid before moving from the selling to the buying side…” Holmberg said, noting that the market is different compared to two to three years ago when it was “very hot”.

“So, remember that even if prices grow, it’s still a tough or slow market.”

READ MORE:

On the other hand, first-time buyers might find a silver lining in the form of lower prices compared to a couple of years ago, making it a potentially favourable time to enter the Swedish housing market.

“First-time buyers are in another situation, which may be better because the prices are lower than two years ago, of course, and if you’re just buying something, you don’t need to worry about the selling part,” Holmberg told The Local.

“That’s why this could be a good situation to enter the housing market this summer, but even so, despite supply being really high, it could still be tough because many sellers have put down a listed price but don’t necessarily plan to sell at this price.”

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