It is important to provide rural onsite training and education as it is challenging to attract persons that have moved for education to move back to an area. (Photos: Magnus Liam Karlsson / Imagebank.sweden.se and iStock)

This chapter, drawing on textual analysis of the preceding chapters, identifies a number of common themes apparent in the Nordic region’s rural labour markets. The inductive method employed means these themes are not based on any pre-defined theory, but arise from commonalities observed across the Nordic countries/territories. While such an approach is undoubtedly fruitful in terms of drawing out shared characteristics, it runs the risk of overlooking those strategies that are unique to each case. As such, the reader is encouraged to approach this chapter having also read the Nordic statistical overview (chapter 2) and national outlooks (chapters 3–9).

The analysis set out below was discussed at a workshop attended by the chapter authors, as well as national and regional development representatives of the Nordic thematic group for Green and Inclusive Rural Development. Through this process, the conclusions drawn were validated by relevant Nordic policy and research experts.

Elin Slätmo
Nordregio

Labour markets in Nordic rural areas are in general characterised by wage work in one single industry, while also having a relatively large proportion of non-wage workers (i.e. individual entrepreneurs/self-employed workers, family businesses, and business with only two or three employees in sectors such as agriculture, forestry, fishery, tourism, natural products, and construction and maintenance work).

The difficulties of measuring ‘rural labour shortage’ make it hard to provide clear results on which types of labour (i.e. people with particular skills and competence) are lacking, as well as where and when these shortfalls are to be found. Nevertheless, the report does give some indications in this direction.

As the national outlook chapters demonstrate, the reasons behind rural labour shortages vary both between and within countries/territories. In some Nordic regions, labour shortages are primarily down to business or seasonal cycles, while other regions are affected by structural issues (e.g. demography, low interregional migration, larger changes in the economy, skills mismatch).

One of the indicators used to identify labour shortages is employment rates. Here, it is notable that, at the Nordic level, both the highest and lowest employment rates are to be found in rural municipalities. On average for all Nordic regions the employment rate is slightly higher in rural areas (81.3%) than in urban areas (80.2%). Having in mind that the differences between the generic urban and rural areas are small for the employment rates, generally speaking, the chapters here presented indicate that areas outside the Nordic countries’ capital regions are more challenged by labour shortages than areas categorised as urban.

Across the Nordic region as a whole, rural municipalities are projected to undergo a 5.8% decline in labour supply, that is the part of the population in working age. By contrast, Nordic urban municipalities will see 7.3% growth in their working age population, and in the municipalities in the Nordics that are categorised as intermediate the labour supply will remain stable.

Notably, rural labour shortages are not a big issue for the Icelandic economy, as labour mobility between regions and immigration of labour from overseas appears to have matched labour demand effectively. In Norway, while there is surprisingly low variation between regions, labour shortages are currently most in evidence in the rural north (Troms, Finnmark and Nordland). Across the Nordic region, interregional labour mobility is reported to be high in some countries (Iceland and Finland), and low in others (Sweden).

Table 10.1 below summarises some of the key results regarding regions and sectors at risk of labour shortages in the Nordic region. Based on this, the sectors most affected by labour shortages – both currently and potentially in the future – are:

Source: Summarised and developed based on national outlook chapters.

As described in the introduction of this report, and as illustrated in Figure 10.1, the problems identified as needed to be scrutinised in order to understand rural labour shortage are at least three-fold:

Moreover, taken together, this study has identified common solutions and strategies to address these problems.

Each of the national outlook chapters set out a number of formal and informal, direct and indirect strategies for addressing rural labour shortages. Taken together, and combined with previous studies, six common solutions and interrelated ‘strategies’ can be identified. These can be seen as a Nordic catalogue of strategies to address rural labour shortage:

In the following, these strategies are described in more detail.

It is clear from both the national outlook chapters and previous studies (Kull et al. 2020) that ‘place attractiveness’ is a core strategy when it comes to combating rural labour shortages in the Nordics. In this respect, rural municipalities and communities have a key role to play in ensuring living environments are thriving and welcoming.

Place attractiveness is intangible in that it relates to feelings of having a high quality of life and being ‘at home’. How best to induce such feelings depends on the individual involved, although some elements can be generalised. These include providing adequate housing for those living in or planning to move to an area, and enabling access to services and infrastructure (e.g. facilitating remote work and education via satisfactory digital infrastructure, and hubs for distance education and shared office space). Place attractiveness also encompasses how people spend their spare time, which translates into investments in cultural, outdoors and sporting activities. Another important aspect is providing the means for inter­regional or inter­national migrants to integrate into their new workplaces and civil society.

The Nordic Rural Youth Panel has highlighted that labour markets cannot be viewed in isolation from young people’s other needs (Meijer et al. 2023). In particular, for young people to be able to move to rural areas for work, attention needs to be paid to the connection between local labour markets and housing provision. Here, hybrid solutions can help rural youth engage in work in their local area, while reaping the social benefits of a regular workplace. Moreover, in order to make rural labour markets more dynamic, there have been calls for companies to establish physical offices, as well as investments in makerspaces and innovation centres that can provide rural start-ups/entrepreneurs with access to technology, equipment and business courses. ‘Rural internships’ established via collaborations between universities/vocational education institutions and rural companies also offer a potential means for young people in rural areas to gain labour market experience.

The Finland, Greenland and Norway chapters point to the fact that part of being an attractive place to live and work is having productive employers that offer good working conditions and flexible working hours agreements. In Iceland, meanwhile, the Icelandic Regional Development Institute (‘Byggðastofnun’ in Icelandic) runs a ‘Fragile Communities’ initiative, which aims to increase employment and sustain rural communities through boosting local economies and infrastructure.

The Swedish Agency for Youth and Civil Society (MUCF) has set up a fund to support youths in rural areas, having discovered they do not feel as included in Swedish society as youths in urban areas. Applicants can request funds for projects up to a maximum budget of SEK 150,000, with successful examples thus far including creating a meeting place for e-sports in Tierp municipality and establishing a cultural centre for youths in Eslöv municipality (Swedish Agency for Economic and Regional Growth 2023).

Rural dimensions of place attractiveness is also further explored in other ongoing projects Nordregio is a part of, such as the project GRANULAR

https://nordregio.org/research/granular/

, which stands for Giving Rural Actors Novel data and re-Useable tools to Lead public Action in Rural areas.

All the national outlook chapters stress that competence development and skills training for the rural labour force is needed to meet Nordic labour market demands. This challenge has also been acknowledged at a European scale, with the twin trends of the green transition and the digital transition bringing increased attention to bear on skills and skills enhancement (EC 2024). In response, the European Commission has produced an ambitions action plan, which will need to be implemented regionally if it is to have a significant impact. More generally, the local and regional level is increasingly being recognised as key to addressing skills mismatches (Lundgren et al. 2020: 47–60).

Elsewhere, a report on economic policy in the wake of the COVID-19-pandemic (Calmfors & Sánchez 2024) highlights the big differences that exist between Nordic labour markets (Forslund 2024). Despite these divergences, the macro-analysis shows that educational efforts and language, digitalisation, and technology training has, together with public support for jobs and employment, had positive effects. Although the pandemic caused big disruptions, a higher share of the Nordic population is recorded as being in employment following the pandemic than was the case before it hit (Forslund 2024). Even so, the results presented in this report indicate that further improvement is needed, especially when it comes to the Nordic region’s rural areas.

The national outlook chapters also point to the perceived importance of providing onsite rural training and education, as attracting people back to rural areas once they have completed their tertiary education elsewhere has proven to be a challenge. One potential solution is to maintain (or in some instances develop) a decentralised education system, establishing more targeted ‘remote learning hubs’ that are connected to the educational bodies capable of providing the skills and competence needed. This is further explored in the Nordregio project EDYNORA

https://nordregio.org/research/education-and-young-adults-in-nordic-rural-areas-edynora/

, focusing on Education and young adults in Nordic rural areas.

The Greenland and Norway chapters highlight that educational demands are important for all age groups. As such, it is important to mobilise local people and upgrade their skills to match the work in hand. The reported reluctance to undertake vocational training and adult education programmes can potentially be addressed by relating vocational training to employment benefits, as in Åland, or providing educational opportunities that take account of the seasonal workloads of those being trained, as in Greenland. In Finland, recruitment training in the metal industry and apprenticeships in the forest sector have yielded positive results. Meanwhile, the initiative taken in Norr- and Västerbotten (Sweden) to coordinate a thorough skills survey and then tailor training and education accordingly offers a promising avenue for meeting labour market demands.

In Nordic rural areas where vacancies exceed the number of unemployed with the required skills, interregional and international migration is needed to ensure good labour force matching. In this respect, migration has been acknowledged as a crucial strategy for labour markets in Finland, Norway, Sweden and Åland.

In Åland, policy support has been provided to attract back Ålanders who have moved away for studies, alongside campaigns and activities encouraging inter­national labour migration. The national outlook chapters also show that relevant migration strategies – for instance, facilitating work permits, language training, and societal and workplace integration – exist in Finland, Sweden and Norway, albeit they are in need of improvement. The fact that extensive language training, alongside programmes directly involving employers, can be effective policy tools for integrating people who have already migrated into Nordic countries but remain outside the labour market has been highlighted in previous studies (Gassen et al. 2021).

The Iceland chapter shows that although international labour migration is supporting the country’s rural labour market, this is not necessary a deliberate policy strategy. Elsewhere, the Denmark chapter highlights that avoiding the outward migration of vocationally trained workers is key for rural areas. Here, an important determinant of whether someone leaves their rural municipality is where they undertake their apprenticeship as students.

Turning to the Norway chapter, the country’s rural-based fishing and agriculture industries are pursuing two strategies for recruiting workers from (mostly) Eastern Europe: 1) buying services from recruitment firms for seasonal workers; and 2) recruitment driven by informal networking, using the relations firms have established with seasonal workers over time.

Integrating refugees and migrants into Nordic labour markets offers a number of opportunities for addressing labour shortages. There has been a substantial increase in migration to the Nordic region, particularly since the 2015 refugee crisis and more recently since the 2022 full-scale invasion of Ukraine by Russia. According to Berlina and Cavicchia (2023), there are approximately 3.5 million immigrants residing in the Nordic countries.

Focusing on employer experiences regarding the integration of immigrants into Nordic labour markets, Berlina and Cavicchia (2023) point to the prevailing consensus among their interviewees that the long-term advantages of employing immigrants outweigh any initial challenges, particularly given the labour shortages faced in various sectors. Furthermore, the employers note that integration processes tend to be smoother than initially anticipated. In terms of relevant support from public authorities, long-term funding for employing migrants is highlighted, as well as providing assistance to employers in sourcing and employing people with foreign and/or refugee backgrounds.

Meanwhile, in their study on migration in Western-Europe, Pricila Birgier and Cantalini (2024) found that non-Western migrants and migrant women face more challenges than Western migrants and male counterparts, respectively. Migrant women in Nordic countries even experience a 'double penalty' of low employment rates and high education. Also, a study of migrant workers in Finland suggests a failure to recognise the competencies they have acquired both locally and abroad has undermined their labour market integration, confining them to low-status secondary sector occupations (Ndomo 2024). Effective integration therefore needs to target discriminating factors, and challenge prevailing norms regarding who possesses the relevant competence to perform a job (Ndomo 2024: 73).

As the Sweden chapter makes clear, strategies that rely on public tax funds to combat rural labour shortages must be both experimental and effective in order to function meaningfully. Towards this end, the ‘Relocate’ project attempted to address low interregional mobility by encouraging people from southern Sweden (Stockholm and Malmö) to move to the country’s north (Skellefteå). The initiative – a collaboration between Region Västerbotten, the employment agency, Skellefteå municipality and Northvolt, and co-financed by the European Union and European Social Fund – identified various obstacles that require policy adjustments in order to make interregional migration more attractive. For instance, the employment agency’s changed mandate since 2021, together with the fragmented service provided by private agencies, has created a void in responsibility. As such, a designated actor is needed to coordinate movement between the areas sending and receiving potential workers, and to mitigate the bureaucratic obstacles faced in relation to migration, education and housing.

In 2023, in response to calls from companies in certain industries – for example, glass producer Emhart Glass in Sundsvall – the Swedish Migration Agency (2024) introduced a fast-track (maximum 30 days) system for high-skilled immigrants. Moreover, recruitment support for business start-ups in finding the right com­pe­tencies has been introduced (SVT nyheter 2024a; Swedish Migration Agency 2024).

Competence mobility between the Nordic countries constitutes another type of labour market mobility. According to Lundgren and Bogason (2022), labour market mobility between the Nordic countries is somewhat modest. Of the total Nordic population of 27.2 million, roughly 40,000 people relocate to another Nordic country each year, while another 49,000 commute to a job in another Nordic country. The same study finds that, of the working-age population working in a Nordic country/territory other than the one in which they were born, the majority of those working in Finland are from Sweden, a large majority of those working in Greenland and Faroe Islands are Danes, and a mix of Swedes and Finns make up the bulk of those in Åland. Elsewhere, Norway, Iceland and in particular Denmark display a more mixed pattern (Lundgren & Bogason 2022; 2023).

International migration – and especially the positive effects of migration that are often overlooked - is studied in the PREMIUM_EU project, within which Nordregio focus on policy analysis and recommendations

https://nordregio.org/research/policy-recommendations-to-maximise-the-beneficial-impact-of-unexplored-mobilities-in-and-beyond-the-european-union-premium_eu/

.

All the chapters presented in this report point to collaboration between actors as a potential model for solving labour shortage in rural areas. This collaborative approach is acknowledged in the national-level policies of every Nordic country, although variations in approach can be seen.

The study’s results suggest further work is needed in terms of setting up publicly funded coordinating bodies that could act as a form of relocation service for interregional and international migration. Such a service – which would provide assistance to anyone looking to relocate for a job, along with their family – would likely prove fruitful in combating rural labour shortages. Here, the ‘one door in’ policy currently being developed in Åland offers inspiration, especially in combination with the territory’s well-established moving home campaign and the policy support extended under the ‘Åland Living’ brand.

In Greenland, so-called ‘Majoriaq’ centres, located in the local community of each town, have been established to guide people towards employment and/or education. Ensuring the success of these centres requires ongoing collaboration between citizens, vocational schools, centre employees and companies.

In Denmark, various stakeholders are finding ways to address the structural challenges faced in relation to demography and becoming a specialised knowledge economy. The identity of these actors appears to depend on the rural region in question.

In Finland, building cooperation between rural enterprises is being pursued as a key solution to rural labour shortages. This includes collaborating to recruit foreign labour directly from abroad, and engaging in rural development projects aimed at improving work conditions.

In Norway, it is usually the rural municipality – supported by regional and national centres of expertise (and financial contributions) – that assumes the role of ‘community developer’. This collaborative approach, which involves cooperation with local industries and voluntary organisations, appears to be the most effective way of dealing with the country’s rural labour shortages.

In December 2023, a tripartite dialogue was held in Reykjavík as a response to public anxieties around potential job losses linked to climate policies and the green transition (Nordic Cooperation 2023). The Nordic government representatives present, along with their social partners, signed a memorandum of understanding (MoU) addressing the effects of the green transition on Nordic labour markets. Given that agreement between governments, labour unions and the business sector is fundamental to ensuring effectively functioning Nordic labour markets, this MoU potentially has a central role to play in guiding how the green transition impacts regional and rural jobs. In this respect, a key statement contained in the MoU is: ‘We recognize the need for new types of skills to match new types of jobs as industry is transformed into a low-carbon economy. Good opportunities for re- and upskilling of workers and job seekers will therefore be essential’ (Nordic Cooperation 2023).

How to work with collaborative approaches in regional planning and policy – in terms of science-society-business-policy interfaces, multi-actor platforms, actor-networks, or collaborative hubs for innovation has been further addressed in Nordregio-projects such as SHERPA

https://nordregio.org/research/the-sustainable-hub-to-engage-in-rural-policies-with-actors-sherpa/

and Collaborative Regional Leadership

https://nordregio.org/research/collaborative-regional-leadership/

.

Hybrid, remote and digital solutions offer a means of creating or maintaining a cost-effective rural (vocational) education model. Moreover, hybrid and remote ways of working are crucial for future-proofing currently thriving rural areas, particularly in light of ongoing urban–rural integration and rapid development of the knowledge economy in the Nordic region. Given the considerable focus on the knowledge economy in labour market developments, and as well in Nordic business policies, it is important to ensure the rural dimensions of any related activities are fully taken into account.

The Finland chapter shows that while the country’s higher educated labour force is already very mobile, in some hospitality and manufacturing industry occupations a further increase in mobility would be helpful. The Greenland chapter, meanwhile, presents the idea of travelling teams – which can cover competence in almost every sector at a national level and be deployed on short-term assignments to different regions – as a mobile, flexible solution to local skills shortages.

Ensuring flexibility can also be a useful strategy, with rural service providers facing challenges in attracting highly skilled workers such as medical doctors, nurses and teachers (Penje & Berlina 2021). Poorer career advancement prospects in rural areas located far from university ‘competence centres’ or central hospitals discourages ambitious professionals from seeking employment in rural communities (Slätmo et al. 2022). Here, although the use of short-time contracts and consultancies can be seen – at least to an extent – as a flexible solution to labour shortages, it is questionable whether such an approach is sustainable over the longer term.

In Sweden, the 21 regional authorities have joined forces to implement a strategy aimed at saving tax funds by creating a common platform that puts a cap on salaries paid to doctors working under short-term contracts (SVT nyheter 2024b). From a taxpayer perspective, such initiatives are especially important for rural areas, where it has proven particularly difficult to fill healthcare vacancies.

Both urban and rural populations are getting older over time across the Nordic countries (Stjernberg 2020). Older people do, however, continue to make valuable economic and societal contributions after retirement, and can provide significant economic and societal benefits, especially if they remain healthy and active (Stjernberg et al. 2021). In a cohort study of the Swedish population, Vilhelmsson et al (2021) report on comparisons between new and previous generations regarding activities in older age groups. The study indicates substantial increases in overall active ageing activity: increases by 7 h per week among the older old and 3.5 h among the young old and older middle-aged. New generations spend more time on work, paid or unpaid, and leisure digital interaction; for some, this is counteracted by less free time spent on social engagement. The new generation of the older old group spends more time on outdoor activity and exercise. These time-use patterns are gendered and dependent on education, mainly due to changes in cohort composition. Here, the ‘silver economy’ refers to all economic activity linked to older age groups. To some degree, fulfilling the silver economy’s potential requires changing popular – often stereotypical – perceptions of the ageing population. Making society more age-friendly, including taking genuine account of senior citizens’ aspirations, is central to making the most of the opportunities presented by the silver economy.

The ageing of the local population is often most keenly felt in rural areas. Given that seniors constitute an increasingly important consumer base, there is potential for recognising and actively promoting the silver economy in such locales. Moreover, active seniors can contribute to addressing labour shortage issues by coming out of retirement or acting as mentors to untrained staff (Slätmo et al. 2022; Stjernberg et al. 2021). Hörnström et al. (2015: 51) also highlight pending pension reforms in Finland, Norway and Sweden as being an important element of the three countries’ national strategies for combating labour shortages.

Labour markets in the Nordic countries show interregional differences both between and within countries. In some urban and rural areas, there is a good balance between jobs and available workers; in others, there are shortages in the market, leading to too few jobs; and in still others there are labour shortages, meaning there are not enough applicants with the right competence. The chapters in this report point to the fact that labour shortages in Nordic rural regions are caused by one or both of a lack of labour (too few workers) and a lack of skills/relevant competence in the existing workforce. Such obstacles hinder regional labour market growth and can contribute to unequal regional development.

There are no quick fixes to the problems at hand, as rural labour shortages are interwoven with a wide array of complex issues – from structural challenges relating to demography, migration and digital/green transition-related economic shifts, to the place attractiveness of rural areas, to changes in shorter-term business and seasonal cycles. While the strategies provided above offer inspiration, they come with the caveat that whichever approach is taken should be adapted to the region that is their subject. In doing so, the in-depth knowledge provided by the national outlook chapters can provide invaluable assistance to local actors dealing with specific (rural) challenges.

One of the key questions this study has sought to explore is: ‘How can the strategies in use to address labour shortages be better targeted at rural-specific problems?’ With this in mind, developing a business and economic, or regional and rural, policy adapted to Nordic rural economies should be given priority going forward.

In attempting to tackle labour shortages, it is important to acknowledge the relatively large proportion of non-wage workers that Nordic rural areas contain relative to urban areas (i.e. individual entrepreneurs/self-employed workers, family businesses, and business with only two or three employees in sectors such as agriculture, forestry, fishery, tourism, natural products, and construction and maintenance work). As such, any business or regional policy wishing to incorporate a rural angle needs to take this disparity into account – above all, it requires a political willingness to pursue hybrid, mobile and flexible policies. More specifically, business and growth departments at the municipality and regional level would gain from proactive coordination and networking efforts, including travelling to enterprises regardless of their size in order to listen to their needs and forge concrete connections. Such efforts can play a useful role in strengthening rural and regional business networks, enabling the concrete establishment of ‘innovation ecosystems’.

This study has also demonstrated that creating or maintaining good living conditions is crucial to addressing rural labour shortages, both in terms of those already living in Nordic rural areas and those who may be enticed to migrate there. Activities towards this end include ensuring adequate housing; enabling access to services and infrastructure (including functional digital infrastructure for remote work and education); providing sufficient leisure facilities; and facilitating the integration of newcomers into workplaces and civil society.

Given that Nordic rural areas are more prone to having an ageing population than urban areas, with seniors constituting an increasingly important consumer base, there is potential for making use of older age groups in combating rural labour shortages. This will, however, only help up to a point, and should be pursued in conjunction with solutions targeting the ‘rural knowledge economy’, as well as the twin digital/green transitions.

Nordic education systems also require a greater rural focus if they are to avoid out-migration from rural areas by those undertaking university studies or vocational training. It is therefore important to ensure a framework is in place for life-long learning via online skills and competence training. Here, remote learning hubs, seasonally adapted training, and strengthening links between education courses and apprenticeships at rural workplaces all have a role to play.

Finally, collaboration between rural businesses and public sector leadership may prove fruitful when it comes to skills enhancement and attracting migrants both from other regions and abroad. Policymakers must be willing to experiment in their attempts to come up with regionally adapted innovations, and as part of this make efforts to ask rural businesses about their most pressing needs.

In sum, there are no quick fixes and inevitably some initiatives will be met with failure. If the countries and territories of the Nordic region are to achieve a sustainable, robust future, however, such failures must be embraced as learning opportunities rather than moments of defeat.

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