Every year, Sweden’s basic industry generates billions to society. A new report shows exactly how important it is to the Swedish welfare. ”We know that industrial companies and their subcontractors are important, but we haven`t known exactly how important they are to society”, says Mattias Säfström, CEO of IUC Steel & Manufacturing.

The report, called “The importance of the basic industry to society”, shows the basic industry’s annual contribution to society. It includes 21 companies in the steel-, paper- and pulp industries in three Swedish regions; Värmland, Dalarna and Gävleborg. Together, they have more then 15,000 employees and contribute EUR 745 million to society. The regional steel industry accounts for EUR 449 million and the paper and pulp industry accounts for EUR 296 million.

Subcontractors are important

The industries success not only means more money to society, but also more jobs. The economic calculation makes it particularly clear when you look at the subcontractors. If the subcontractors increase their profit with one per cent, it creates 250 new jobs and generates EUR 3 million in revenue to society.

“It’s good that we can show what it means for our region if the basic industry only do business with our regional subcontractors,” says Maria Hollander, CEO of the world-leading business cluster Paper Province.

In need of competence

If the industries disappear, subcontractors and many jobs will follow.

“The single largest risk factor is the availability of competent personnel. Without competence, there is a risk that the big industries move, but it is equally important for the industry’s overall growth that the subcontractors find the skills they need, otherwise the companies cannot justify staying here”, says Maria Hollander.

Moving a company from one municipality to another can have major repercussions for a small municipality. Work opportunities decrease and so do revenues. It can mean a reduced number of inhabitants for the municipality, and If the company moves abroad, the entire country will be affected in the same way.

Therefore, it’s important to ensure competence and make sure the companies have access to needed knowledge. Some regions are already working preventively by mapping future needs:

“We believe in a common industrial strategy or agenda for the regions”, says Mattias Säfström at IUC Steel & Manufacturing.

* The report is produced by ITA Development commissioned by IUC Dalarna, IDC Steel and Engineering, Paper Province and Triple Steelix.