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High purchasing power keeps consumption going. Conversely, reduced purchasing power, lower wages, means the wheels turn more slowly. Despite this, several right-wing debaters, including Joakim Ruist, advocate for increased wage dispersion.
LO's chief economists write in Göteborgs-Posten :
"Lower wages therefore lead to lower demand for goods and services. Lower wage increases also lead to lower inflation and thus to higher real interest rates, which inhibits investment.
It is therefore not obvious that lower wages actually create more jobs.
What is clear, however, is that a slower rate of wage growth results in lower inflation. This allows the Riksbank to lower the interest rate, which in turn stimulates demand. Which effects wage restraint has on employment thus depends to a large extent on how monetary policy responds."
The LO economists continue to write:
"In the type of macro models used by central banks around the world, wage moderation generally has no positive effects on employment."
Lower wages lead to a debt economy. In order to solve their everyday problems and ensure that they can afford the necessary expenses, low-income earners are forced to take out everything from SMS loans to other high-interest loans. The right has always tried to create a more unjust society. Nowadays it is often said that Sweden has a far too compressed wage structure. But these are just new words for the same old class politics. The right wants to increase the differences in society, believe nothing else.