When the new regime with a floating exchange rate and inflation target was introduced in the beginning of the 1990s, it entailed new macroeconomic conditions for collective bargaining agreements. During the 1970 and 1980s, inflation averaged around 8 per cent and real wage growth was almost non-existent. The slowdown in inflation coupled with a relatively stable rate of increase in nominal wages meant that real wages rose sharply between 1995 and 2004, see Table 1.3 Not since the 1960s has there been such a long period of regular real wage increases. In 2004, around 450 collective bargaining agreements were concluded for some 2 million employees, most of them spanning three years. This year, approximately 70 collective bargaining agreements will be signed for just over 1.3 million employees. Municipalities and county councils account for 1.1 million of these, and an agreement covering just over two years has already been concluded for them. Recently, agreements have been signed for some 75 000 workers in the construction sector and about 60 000 employees in banking and insurance. The latter group received more than what has become the norm in the current agreement period. Worth noting is that almost the entire economy has an agreement period that runs up to some time in the middle of 2007.
Moreover, our current account surplus essentially means that we are exporting capital on a large scale; in somewhat more extreme terms, you could say that the jobs being created by our growth are largely ending up outside Sweden's borders. So the low employment growth does not appear primarily to be a result of weak demand. Instead, the explanation must be sought among longer-term structural factors. This is reflected in particular by the fact that the employment rate, in spite of historically high economic growth, has not completely recovered since its sharp fall in connection with the crisis in the early 1990s. Moreover, the fact that open unemployment did not drop more during the economic upswing in the 1990s suggests that the labour market is not functioning satisfactorily. One example of rigidities in the labour market is that unemployment has remained around 8 per cent in the construction sector,  6  BIS Review 84/2005  even though it is one of the few sectors where activity has risen and labour shortages have begun to appear. Another sign that the unemployment problems are structural in nature is the large differences across regions and occupational categories. In spite of a single monetary policy for the whole of the Swedish economy, unemployment figures in some regions are twice as high as in others, while the proportion of people receiving benefit from their unemployment fund is twice as high in some occupational categories as in others.