introduction
introduction
State of the Nordic Region – comparative perspective on regional development and territorial differences
Across the Nordic countries, demographic, economic, social and territorial trends play out differently from one region to another, shaping distinct development paths and policy challenges. This 21st edition of State of the Nordic Region examines how these trends unfold across regions, and how similar challenges are addressed in different national and regional contexts. By focusing on territorial variation alongside national and Nordic averages, the report seeks to deepen understanding of how geographically specific conditions shape development trajectories within broadly comparable welfare states. It does so in a context in which the similarities between the countries are as significant to the analysis as the differences, as they shape interpretations of the variation – a rare and unusual approach in international comparisons.
The Nordic countries are often described as sharing a common societal model, characterised by strong public institutions and extensive welfare systems. An additional factor, perhaps less visible to most readers but no less important for comparative analysis, is that the countries’ statistical foundations are well developed and broadly compatible. At the same time, the Nordic Region encompasses considerable geographical diversity: sparsely populated rural and peripheral areas, dense metropolitan regions, coastal and inland economies, and regions with markedly different demographic profiles and labour market structures. Understanding how such diversity interacts with broader societal change is central to any discussion of regional development in the Nordic context.
Several transformations that are set to play out over the long term are currently shaping the Nordic regions. Many areas are affected by demographic ageing and population decline, while others are experiencing rapid growth driven by urbanisation and migration. Labour markets are being restructured, the green transition is altering production systems and spatial demand, and increasing geopolitical uncertainty has brought renewed attention to issues of resilience, preparedness and territorial cohesion. These processes do not affect all regions in the same way. Their consequences are mediated by geography, accessibility, economic specialisation and institutional arrangements, all of which make regional analysis indispensable.
Comparing apple varieties – not apples and oranges
The comparative perspective is a defining feature of this report. Much of the analysis presented in State of the Nordic Region is based on comparisons between the Nordic countries and their regions. This reflects a deliberate analytical choice grounded in the particular strengths inherent in Nordic comparison.
Comparing the Nordic countries is not a matter of comparing apples and oranges. Instead, it is more appropriately understood as a comparison of apple varieties. The countries share broadly similar welfare state principles, governance traditions and institutional arrangements. This degree of similarity affects the interpretation of their differences, particularly when the aim is to learn from variation rather than explain it away. It implies that observed differences in outcomes are less likely to be driven by fundamentally different societal models, and more likely to reflect variation in geography, demography, economic structure, policy design or territorial organisation.
The comparability of the contexts means that the differences are analytically productive. They attract attention, rather than being set aside as incomparable, and invite explanation rather than dismissal. When regions or countries facing broadly similar challenges arrive at different outcomes or pursue different approaches, those differences become meaningful signals. They raise questions about why development takes one form rather than another, and about the conditions under which alternative trajectories may emerge.
For this reason, Nordic-level comparisons are especially relevant from a learning perspective. The aim is not to identify universal “best practices” or to promote straightforward policy transfer. Instead, the value lies in understanding how different solutions may emerge within similar overarching frameworks, and what this may reveal about potential policy choices, trade-offs and constraints. In this context, learning is analytical rather than prescriptive. It is intended to support reflection, adaptation and informed decision-making, rather than replication. In practical terms, this means providing a basis for questioning assumptions, reassessing available options and understanding the implications of different choices across comparable contexts. Where relevant, the report also situates Nordic developments in a broader European context.
A report shaped by its time
This edition of State of the Nordic Region follows the established thematic structure of previous reports. As in earlier editions, the analysis is organised around three broad areas of regional development: demography, labour markets and the economy. Together, these areas capture central dimensions of how the Nordic regions change over time and provide a stable analytical framework for comparison.
Within this structure, the substantive focus of the individual chapters emerged through an open and iterative process. Different thematic directions were discussed, some were refined, and others were set aside, in some cases with the intention of revisiting them in future editions. The content also mirrors the collective assessment of Nordregio’s researchers regarding what they believe readers will find analytically interesting and useful. Rather than following a single guiding narrative, the chapters engage with different aspects of ongoing change, informed by empirical patterns, current debates and emerging concerns across the Nordic Region.
Even so, a careful reader may notice that certain issues recur across chapters. Themes related to demographic change, economic restructuring, labour market dynamics and, more broadly, questions of uncertainty and resilience appear throughout, and in different ways. This should not be interpreted as the result of a single guiding theme imposed from the outset, nor as evidence of a fully integrated analytical framework. Rather, it mirrors the questions to which many researchers find themselves returning at the moment, consciously or not, as they seek to understand regional development in a period characterised by overlapping transitions and heightened uncertainty. In such a context, there is an inherent risk of focusing too narrowly on short-term developments. As such, one of the central tasks of this edition has been to balance a focus on immediate events with an emphasis on longer-term structural trends.
Taken together, the chapters reflect a Nordic Region shaped by multiple, partly overlapping developments. Rather than advancing a single narrative or diagnosis, the report documents patterns and variations in regional development across different thematic domains. In doing so, it offers an empirically grounded account of how regional development currently unfolds across the Nordic countries.
The regional approach
The analyses presented in this report draw on a range of geographical classifications and territorial delineations that are used to structure and compare developments across the Nordic countries. As in previous editions, the approach spans national, regional and local levels, with analyses primarily based on harmonised data from the national statistical offices.
Before turning to the individual chapters, this section outlines how the report applies different spatial units and typologies, and how these serve as points of reference for the maps and analyses.
Map 1.1: Regions and municipalities in the Nordic Region, 2025. Finland, Norway, Sweden: Regional level = NUTS3; Denmark: Regional level = NUTS2 Iceland: Regional level = LAU1 The Faroe Islands, Greenland, Åland: Regional level = National level |
The Nordic Region consists of Denmark, Finland, Iceland, Norway, Sweden, the Faroe Islands, Greenland, and Åland. The regional analysis treats all of them as equal units, even though the statistical coverage varies. State of the Nordic Region analyses social and economic trends starting at the national level, and then breaks them down into regional and municipal comparisons. The data are primarily sourced from national statistical offices. Significant efforts have been made to harmonise the indicators in order to facilitate comparability between countries.
Table 1.1 summarises the administrative structure in each of the Nordic countries. These structures form the basis for the Nomenclature of Territorial Units for Statistics (NUTS) classification – a hierarchical system that divides the European states into statistical units for research purposes. In general, the NUTS and Local Administrative Units (LAU) classifications follow existing divisions, but these may differ from country to country. Light-grey cells represent the regional levels presented in most of the regional maps in the report. There are currently 66 regions at this level. Dark-grey cells indicate the local units represented on most municipal maps. There are currently 1,130 units at this level. In this edition, Nordregio has developed new grid-level maps and an urban-rural typology, which facilitates new ways of analysing the data. This typology has also been made available to other researchers.
NUTS 0 | Denmark | Finland | Iceland | Norway | Sweden | Faroe Islands | Greenland | |
|---|---|---|---|---|---|---|---|---|
Regional | NUTS 1 | Manner-Suomi Fasta Finland Åland Ahvenanmaa 2 | Landsdel 3 | | ||||
NUTS 2 | Region 5 | Suuralue Storområde 5 | Landsdel 7 | Riksområde 8 | ||||
NUTS 3 | Landsdel 11 | Maakunta Landskap 19 | Hagskýrslusvædi 2 | Fylke 11 | Region/Län 21 | |||
Local | LAU 1 | Kommune 99 | Seutukunta Ekonomisk region 70 | Landsvædi 8 | Økonomisk region 89 | Sýsla 6 | ||
LAU 2 | Sogn 2133 | Kunta Kommun 309 | Sveitarfélög 64 | Kommune 357 | Kommun 290 | Kommuna 29 | Kommunia 5 |
Table 1.1: Administrative structure of the Nordic Region, 1 January 2025. Åland makes up 16 of Finland’s 309 municipalities and 1 of the 19 Maakunta/Landskap. |
Administrative boundary changes in the Nordic Region
The administrative boundary reforms in the Nordic Region primarily occur at the municipal or regional level. The Nordic model emphasises strong local self-government, which makes municipal changes more common than regional ones, although frequent restructuring means that smaller communities run the risk of losing ownership and identity. Such boundary reforms are typically driven by population changes, financial pressures or efforts to enhance efficiency in service provision and governance.
The pace of reform varies considerably across the Region. Norway has seen the most active administrative restructuring since the previous edition of State of the Nordic Region, with formerly merged counties dissolved and historical boundaries restored. Specifically, Viken was separated into Akershus, Buskerud, and Østfold; Troms og Finnmark was divided back into Troms and Finnmark; and Vestfold og Telemark split into Vestfold and Telemark. Finland approved one municipal merger in 2024. Iceland, Åland, and the Faroe Islands remain in the discussion and planning phases. Denmark and Sweden are currently in stable phases, with no ongoing structural reforms.
Data for the Nordic Region
This report strives to present a comprehensive picture of the entire Nordic Region and to treat territories with equal analytical precision. However, disparities in reporting standards and the availability of statistical data pose challenges to fully comparable analyses. These differences exist not only between larger countries and smaller territories, but also between the bigger Nordic countries, which have their own classification systems, spatial granularities and reporting methodologies. Despite these constraints, this report endeavours to provide the best possible analysis and overview from existing data sources. Where necessary, it adapts methodologies to enable comparison between the Nordic countries and municipalities, while also ensuring that all territories are meaningfully represented.
The nature of the data challenges varies across both territories and analytical domains. Demographic vital statistics are relatively well-covered across all territories, and long-term municipal data is typically available. However, migration-related data reveal systematic differences: Greenland and Åland use reporting systems that categorise foreign-born populations, diverging from other Nordic approaches. Labour market data highlights more pronounced disparities. While Denmark, Finland, Norway and Sweden provide harmonisable, municipal-level employment and unemployment statistics, the analysis for Greenland, the Faroe Islands and Iceland often relies on national-level aggregates. The greatest variation is seen in economic indicators, with measures such as gross regional product entirely unavailable for Greenland, or available only at the national level for the Faroe Islands.
Throughout this report, we have employed careful methodological adaptations to maximise comparability while respecting these diverse data landscapes. Where detailed data exists, it has been harmonised across different classification systems to enable meaningful comparisons. Where only aggregated data is available, we present it transparently alongside more granular information and clearly indicate spatial scales and methodological adjustments. We analyse the Nordic Region as a single comparative entity, but also fully recognise the internal structural diversity – administrative, demographic, geographic and statistical – across all regions and municipalities. This reflects the long-standing approach that has been applied consistently in previous editions of this report.
Scope and structure
Taken together, the 21st edition of State of the Nordic Region combines a recurring thematic structure with attention to contemporary developments and changing data conditions. It approaches the Nordic Region as a common frame of reference for comparison while analysing the territorial differences that characterise it. The chapters that follow examine demographic change, labour market structures and economic transformation. In doing so, they provide analytical perspectives on the current state of regional development in the Nordic Region.