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IN NUMBERS: How Swedish telecoms giant Ericsson fared in 2021

Ericsson has released its latest quarterly report, revealing both ups and downs.

Published: 25 January 2022 09:10 CET
IN NUMBERS: How Swedish telecoms giant Ericsson fared in 2021
Ericsson's headquarters in Kista, Stockholm. Photo: Fredrik Sandberg/TT

Ericsson said on Tuesday that its net profit soared in 2021, with a better-than-expected performance in the fourth quarter despite losing ground in the key Chinese market.

The world’s number two telecoms equipment maker is competing with China’s Huawei in the global rollout of ultra-fast 5G mobile phone networks.

But Ericsson’s sales in China have taken a major hit as it has faced reprisals there since Sweden banned Huawei and another Chinese firm, ZTE, from the European country’s 5G network in 2020 for security reasons.

Despite the challenges, the Swedish company expects to reach its long-term profitability target sooner than previously estimated.

“Our strategy to invest in technology leadership and grow market share in our core business underpinned a robust financial performance in 2021 and ensured a good Q4 for Ericsson overall,” chief executive Börje Ekholm said in a statement.

Net profit soared by 30 percent last year to 23 billion kronor ($2.5 billion). Sales were stable at 232.3 billion kronor in 2021.

Its profit surged by 41 percent in the fourth quarter to 10.1 billion kronor, while sales rose by three percent at 71.3 billion kronor.

Analysts surveyed by Bloomberg had expected a quarterly profit retreating to 7.1 billion kronor.

In mainland China, sales plunged by 7.7 billion kronor last year, but Ericsson made up those losses by gaining ground in other markets.

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NORTHVOLT

Northvolt warns work permit salary threshold could jeopardise Sweden’s green transition

Sweden’s minimum salary threshold for work permits has increased by almost 120 percent in less than a year, and there are plans to increase it again to the median salary next summer. Battery manufacturers Northvolt warns that this could stop the company from hiring and retaining key workers.

Published: 3 July 2024 12:32 CEST
Northvolt warns work permit salary threshold could jeopardise Sweden's green transition

“Northvolt’s extensive labour requirements in northern Sweden cannot currently be met by permanently established workers in Sweden or within the EU,” the company wrote in a response to the government’s proposal to raise the salary threshold to the median salary, currently 35,600 kronor.

“This applies in particular to machine operators and technicians, whose minimum wages under collective bargaining agreements are lower than the median wage, and therefore are particularly vulnerable in this context.”

The EU has highlighted qualified machine operators and technicians as professions which are particularly hard to source within the bloc, meaning companies often have no choice but to source these workers from non-EU countries.

Northvolt has the added complication of being located in northern Sweden, an area which in general often struggles to find key workers in a number of industries, and the company isn’t convinced that enough is being done to fix this.

“Northvolt does not believe that the government and the Public Employment Service’s measures to promote geographic mobility in the Swedish labour market is going to be able to cover the company’s need for labour,” it wrote, while adding that it believes the proposed hike to the work permit salary threshold could have “significant consequences” for its facility in Skellefteå.

“Aside from the direct effects on the company, Northvolt sees a risk that staffing in healthcare, services and infrastructure in northern Sweden could be negatively affected by the salary threshold, which would indirectly affect Northvolt’s expansion.”

In addition to this, the company deems the proposed exemptions to the salary threshold – these would be put forward by the Migration Agency and the Public Employment Service based on professions where there’s a labour shortage – to be insufficient and unpredictable.

Northvolt’s criticism highlighted the fact that the exemptions are based on a model which is currently under development and which may not be ready by the time the law is due to come into force, as well as the fact that professions with a labour shortage will be defined using a so-called SSYK code.

Some key roles for Northvolt to do with battery production do not have one of these codes, as they are relatively new roles.

“It remains to be seen how the proposed model would effectively be able to identify professions with a labour shortage when they don’t have an SSYK code,” the company wrote, adding that this all makes it harder for the company to plan, for example, will an employee who is granted a work permit once be eligible for renewal two years later?

“The employee in that situation would risk being deported from Sweden. If that were to happen, it would be deeply unfair for the employee who has contributed to supporting Swedish society in a role where there is a shortage, and a catastrophe for the employer who has invested years of education and talent in the employee.”

“This lack of predictability can be compared to earlier notorious so-called kompetensutvisningar (talent deportations), and will further complicate the recruitment or necessary talent,” it wrote.

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