Why the Swedish IT market is so interesting
Sweden is very popular as an IT hub and possesses a competitive advantage as a leader in technology. The country has always been at the forefront of the technology wave that has been influencing the different parts of the world. Sweden is credited to be the first country that regulated the telecommunications market way back in 1993.
The reasons for the popularity of Sweden as a technological hub
- It was one of the largest countries in the Nordics
- The strategic positioning of the country has been a major advantage for it
- It is the second successful technological hub of the world; the first being Silicon Valley
- Sweden has been ranked second in the Global Competitiveness Report
- Sweden holds the fifth position in the globalization index
- The country possess some of the best infrastructure in the world
- The government has released many policies and programs that have helped in the growth of the country as an IT hub
- Sweden has some rich investors who were ready to invest.
- The educational opportunities provided to youngsters helped in answering to the demand of talented software engineers in various sectors
- There were tax deductions for people who were engaged in start ups
Lets examine some of those reasons in detail
Improved educational system led to tech savvy talent
The high levels of education provided to students led to a greater acceptance and conversion rates of technology. The country has always stood steadfast in its commitment to provide exceptional IT education and training. This major shift towards training started around 1990. This was accentuated even further with Swedish schools having more than 96% Internet access rate. Several students have started learning Information Technology with an aim to starting their own start up or work in multinational companies; there was an increase of 42% during the period 1995-2000. The Swedish IT industry also had its ups and lows; about the time other countries of the world were experiencing recession, but Sweden always bounced back. Another contributing factor to the increase of IT educated people in the country was because of the perceived status of IT professionals. They were ranked really high, especially Software engineers, Software consultants, Web designers and computer operators.
In Sweden, the two main industries that demand IT professionals are Electronics and ICT (Information and Technologies Company).
The Sweden government has played an important role in improving the educational system so it accommodates the IT demands of today. The government started several programs to promote IT, one of which is Sweden Information Technology – Occupational Training to provide education through employment oriented classes to students. Such programs played a major role in increasing the qualification level of IT professionals in the country. These programs were initiated to fill the talent gap that were prevalent in three main cities of Sweden – Malmo, Gothenburg and Stockholm
An increasing VC
Sweden’s Venture Capital is pretty strong and supportive, especially for startups. Startup entrepreneurs are seeing this as a great platform where they can thrive, thanks to a huge market growth. With its strong VC, Sweden has been attracting R&D investments and foreign capital.
Sweden is a small city
As Sweden is a small city, it has its advantages as well. And it is populous as well, and business owners have been trying to enter the international arena by hacking the global market. While certain companies focus on establishing their presence in the national niche, many of them started concentrating on people from various countries, especially in the tech space.
Companies work hard to make their businesses more environment friendly
The Swedish IT sector provides employment to more than 3.9% of the workforce. Even during economic recession, the IT sector in Sweden fared well because of the outlook the businesses took. The businesses and companies believed that IT products and services are very important for survival and hence, they continued to put in combined efforts for its growth. They had access to the Internet, which further accentuated this. Swedish people are pretty open minded; they are always supportive of testing new products and services whenever required.
Sweden was one of the countries that recovered quickly from economic crisis in the past, and several companies started making their mark through investments, thanks to the availability of sophisticated technological advancements. Additionally, Swedish people are innovative and their ideas always sell. And they are able to follow new trends.
An interesting aspect
The most interesting aspect about Swedish IT market is that until the end of 19th century, the world did not hear much about Sweden because the country was one of the poorest in Europe. Eventually, the country’s standards improved and thanks to additional advantages of high-tech capitalism, labor force with good skills and external communications, the Swedish economy improved and recovered quickly after each economic crisis. That, combined with the government’s policies and reforms made foreign investments possible. IT is the fourth largest sector in the country because it has bound itself to the development of society, thereby leading to economic growth and productivity.
Eventually, Sweden became the startup capital of Europe and Stockholm evolved to be the second most tech hub of the world on a per capita basis. Sweden is home to several large tech giants including Spotify, Klarna, Skype and Sound Cloud. Stockholm was the second city in Europe to have the highest percentage exit growth.
Interesting links about the topic:
Pictures: Flickr.com/ Raymond/ Frances Main/ Potter/ Rydbergy
The author: Reema Oamkumar is engaged as a thought leader at Software-Developer-India.com which is a part of the YUHIRO Group. YUHIRO is a German-Indian enterprise which provides programmers to IT companies, agencies and IT departments.