It is just this stability in the fundamental conditions for economic activities that was no doubt important for the process that resulted in the industrial revolution, which in itself was full of commercial risks and uncertainties. Improvement in opportunities for change A similar gloss can be applied to the realignment of economic policy from the second half of the 1980s. There have been a number of reforms aimed at creating stability and opportunities. The credit and currency markets have been deregulated, components of the social security system have been reformed, a tax reform has been implemented, targets have been established for government finances, price stability is enshrined in law and the Riksbank has been given an independent status. All this represents good possibilities of the Swedish economy facing a stable future as we step over the threshold to a new millennium. It is important that wage formation also functions properly. It remains to be seen whether the Swedish economy has changed in this area. Otherwise, there is a risk that firms will be under pressure from two fronts. Profitability will be depressed both by increased competition and by rising wage costs. Investment will be held back and the transformation will proceed too slowly or not at all. There will then be no quick renewal of capital stocks. Companies will not draw the benefit of the new information technology at a sufficiently rapid rate and will then lag behind.
Employment in different sectors during the 20th century 80  80  70  70  60  60  50  50  40  40  30  30  20  20  10  10  0  0 1900  1910  1920  Agriculture  BIS Review 137/1999  1930  1940  1950  1960  1970  Public and private sector  4  1980  1990  2000  Industry  The employment trends in different sectors, as a proportion of total employment, shows the Swedish economy’s transformation during the 20th century. Three different stages are especially clear. Firstly, fewer and fewer people earn a living from agriculture over the years. Having provided employment for around 60% of the labour force at the beginning of the century, agriculture now engages only a couple of per cent. This change reflects a dramatic increase in agricultural productivity and thereby internal migration. The population in rural areas falls and large cities such as Malmö, Gothenburg and Stockholm grow. It is also primarily in these regions that growth is generated. Secondly, the shrinking agricultural sector is reflected in a corresponding increase in industrial employment. Manufacturing occupied over 30% of the labour force in the 1950s when this part of Sweden’s corporate sector was largest in terms of employment. Thereafter, the proportion of employed in this sector has fallen. Finally, the really dramatic development as regards increased employment is the expansion of the service sector.