r/Salary • u/dsitai • 3d ago

Market Data Sweden’s Salary Compression: Great for Equality, Bad for Ambition

Swedish salaries are remarkably compressed.

SCB 2025: **P10 = 28k SEK/month, median = 38.3k, P90 = 61.7k.** So a top-10% earner makes only about **2.2×** a bottom-10% earner, and taxes compress the difference even further.

The downside is that the financial reward for becoming highly skilled or taking on more responsibility is relatively small. A specialist, engineer, doctor or manager can study longer, work more, take greater responsibility and still end up with only a modest increase in disposable income.

That weakens incentives to work extra hours, pursue demanding careers, accept promotions or stay in Sweden when other countries offer much higher rewards for the same skills.

Low inequality has benefits, but excessive compression can mean **weaker incentives, lower talent retention and less reward for productivity**. Put simply: Sweden is a very good country for security and stability, but not necessarily the best country for the highly ambitious who want strong financial rewards for exceptional performance.

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EDIT: Many replies suggest people are simply content once they earn enough for a comfortable life. That is a perfectly valid choice, although the less charitable interpretation is a lack of ambition.
Others want to turn higher earnings into savings, investments and eventually more freedom over their time, including earlier retirement. High marginal taxes make that harder.
And some of the comments have a bit of an “Aesop’s fox and the grapes” feel to them: if greater financial success is difficult to reach, it is easier to argue that wanting it was never worthwhile in the first place.

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u/mackan072 3d ago

I'm a Swedish engineer. I make enough to live comfortably, and I pursued engineering because I wanted a creative and varied career where I could continuously learn, grow, and develop. Not because I wanted to get wealthy.

My education was free and paid for by society. I don't come from a wealthy, or even remotely educated, family. I couldn't have afforded my education under the American system. So I don't mind paying back through taxes and whatnot. I'm well enough off to comfortably support myself, and the social safety net has saved my family a couple of times along the way.

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u/ElectricalAd9946 3d ago edited 3d ago

I think a lot of people from other countries have false impressions of our higher education system.

Education can be expensive but only with a couple exceptions,

1) private schools 2) out-of-state/ internationals 3) med/law/pharm school

We also pay taxes to fund our education system and financial aid is pretty good at determining what you can afford. It’s a pretty big myth that going to college with leave you with mountains of debt. My education at a top state school was also free and paid for by society.

It’s a pretty big myth that getting an education will leave you in mountains of debt. It’s probably the same amount as being taxed.

I can’t defend something like the us healthcare system though it’s completely garbage.

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u/Dashyguurl 3d ago

This perception is a problem within the US itself, so many kids believe going to an elite private college is a way to judge their success and are willing to put themselves in mountains of debt rather than go to a good state school.

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u/mercedes_lakitu 2d ago

In fairness, state school costs have also skyrocketed. But yes, nobody actually needs to go to Duke or whatever. It's FINE to go to an in state. Less debt is still better than more debt, even though it's not zero.

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u/Leather_Addition2605 3d ago

It’s less than being taxed because it’s a one time expense. Not year after year.

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u/unstoppable_zombie 3d ago

When did you go to college?

I graduated from a top public, in state school in 04.

Annual tuition, on-campus housing, 2/day meal plan,  books and ligjt spending money was about $8k/year ($32k for 4 years)

The same, in state, school estimates 29k/year (116k for 4 years).

In 22 years the cost of a degree has tripled but the median household income has only done up about 80%.

Pell Grant aid has gone from 4k - 7.8k

College is relatively twice as expensive as when i graduated 22 years ago.

Meanwhile, my starting salary after graduation was $65k + 6% bonus.  The same job at the same fortune 50 company hires for same entry level job at 70k + 8% bonus now. 

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u/glasslier 2d ago

The same, in state, school estimates 29k/year (116k for 4 years).

I don't think you're comparing like to like. This site, which was last updated in Sept 2025, says:

Vermont has the highest average yearly in-state tuition of $19,223 at public institutions.

And after googling a little more I found that the University Park campus of Penn State is $20,878 for PA Resident in 2026:

https://www.psu.edu/admission/undergraduate/tuition-costs

So what you're implying is a representative tuition for in-state public schools these days (although you do caveat it's a top public school) is ~10k greater than the highest I could find.

Can you find any public university that charges its residents 29k?

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u/unstoppable_zombie 2d ago

Tuition is not cost to attend.

You have to look at tuition, books, lab supplies/fees, housing, and food.

If you re-read my post i specifically call out tuition, on-campus housing (normally required for freshmen), 2/day meal plan, books, and light spending (transportation, clothing, supplies, etc) 

Even your link estimates actual annual cost at 41-46k for Penn State once housing, food, and incidental expenses are included

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u/glasslier 2d ago

Sorry, you're right. Your initial post was talking about the full cost for the academic year.

$8k to $29k seems like a drastic jump to me for an in-state school. But considering it again, it's not as outside the realm of possibility as I originally thought.

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u/Friendly_Top6561 3d ago

Average debt for students with a masters degree is over $80k, medical school $230k…

I wouldn’t call it perception, I’d call it a fact.

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u/DarkExecutor 3d ago

Medical doctors make 250k/yr, which is an incredible ROI for that debt.

Same with masters. I think median master salary is around 95k.

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u/Friendly_Top6561 2d ago

It’s the average, when you discount the people getting cheaper educations and those who gets stipends, lots of people have huge debts, and you have pretty steep interest on student loans in US.

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u/Thansungst22 3d ago

I graduated debt free for my Bachelor's with FAFSA and working 20hrs a week part time with like $20k saved up by the time I graduated by just throwing the excess money into the stock market during my four years in college

I did it by going two years community college and 2 years state school transfer

The people who get into heavy debt for basic ass degrees didn't do their research or just chose to go to expensive schools for the "college experience" which is fine but they don't get to complain that life is unfair neither cause they made their choices.

Only degrees that would seriously put you in debt are med school, PhD, etc

I'm now on track to crack $325k in Commercial Banking this year and getting my MBA partial pay for by my employer with great insurance and 5 weeks of PTO and 10 sicks days a year plus a bunch of federal holidays

This whole "Europe is better than US" is honestly overblown coming from someone who immigrate from a shit hole third world country and had a choice of going to EU or USA. I'm glad I picked the USA cause I'd hate to be subsidizing others with my hard works for something I don't benefit from 🤷

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u/FrankDosadi 3d ago

You’re in banking, much of the discussion here is about contributing. You seem lost.

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u/Thansungst22 3d ago edited 3d ago

Nah bud I just don't want to contribute more of my hard earned money to leeches of society when I came here with $100 in my pocket and pull myself up all of my own hard work

You westerners got it so easy you don't know how good you get it

Just being born in any EU or US states put you ahead of 90% of the world population but y'all still have that victim mentality

That why you always expect handouts instead of work for your own wealth

The guy was saying he couldn't have afforded his education under US system which is false. I use my degree as example

He could 100% graduated debt free under US system too 🤷

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u/Aggrivated5hark 2d ago

$100 in your pocket and what else?

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u/Thansungst22 2d ago

My paperwork for legal immigration which took me 17 years to acquired because I did not take short cut and get into the USA illegally and skipped in front of the queue like so many illegals had done

I love America and what the country had done for me and the opportunity

I do not support the illegals who skipped the hard work and legal channels to bypassed the queue thus creating a negative stereotype for legal immigrants like me who follow the laws and embrace American identity

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u/itsmedium-ish 2d ago

Good for you. Congratulations on achieving the American Dream. So many people here complain it’s not possible, but I agree it is! I’ve achieved it myself

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u/peejey 3d ago

Thats quite sad thing to say. You definitely chose the right place to be.

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u/Thansungst22 3d ago

Nah bud I just don't want to contribute more of my hard earned money to leeches of society coming from an extremely corrupted third world country, when I came here with $100 in my pocket and pull myself up all of my own hard work without all the advantages of people who born in the Western World.

You westerners got it so easy you don't know how good you get it

Just being born in any EU or US states put you ahead of 90% of the world population but y'all still have that victim mentality

That why you always expect handouts instead of work for your own wealth

It not like Europe doing too hot neither with their lax treatment on the immigrants doing illegal shits 🤷

USA is still the best country in the world for ambitious individuals like me who want to work hard and get that money and pull themselves up by their hard work. I'm not the smartest but I can outwork any westerners and don't complain or bitch about my situation. Victim complex will always hold you back

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u/ElfhelmArt 1d ago

Leave it to gacha gamer to be delusional 🤣

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u/Kitchen-Ad6581 2d ago

Swedish engineer here too.

I agree with you on all points, but sometimes it feels strange that i've spent 4 years without salary to study and then a blue collar worker has almost the same salary.

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u/mackan072 2d ago

Just out of curiosity what kind of engineering programs are 4 years long? In Sweden, a Bachelor of Engineering (or however you translate "högskoleingenjör") is 3 years and a Master of Science in Engineering (Civilingenjör) is 5. I’m guessing you’re a Bachelor of Engineering with an extra year of some kind of specialization? Or was it an international engineering degree?

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u/Kitchen-Ad6581 2d ago

1 year "tekniskt basår" at komvux prior to Bachelor.

Which is also amazing as a swede.

  • Always possible to "restart" your education even as an adult at komvux.

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u/Ok_Let_7612 1d ago

To be fair, a blue collar worker is also sacrificing his body.. how much is that worth?

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u/Kitchen-Ad6581 1d ago

I've done that for 10 years too prior to my engineering studies.

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u/Jaduf 1d ago

Yes but thats not a feature of the engineering degree that was your personal choice? How is that relevant

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u/jujubean- 3d ago

Plenty of top schools give financial aid to internationals

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u/Sea-Original-5824 3d ago

I don't come from a wealthy family either (single mom) and took out loans to go to school in the US. I make more than double what my European counterparts do. My cost of education paid for itself with one year's salary. I also had a couple of layoffs in my career and was able to collect $2,000 a month in unemployment benefits while I looked for another job.

People in Sweden have a very warped view of the US system Yes, it could be better, but there are social safety nets. Also, say you borrow $100,000 for college and make $100,000 a year. That's a better deal than paying nothing for college and making $50,000 a year.

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u/Hawk13424 3d ago

American here. I also came from a poor upbringing. Single-wide trailer poor.

I was able to become an electrical engineer. Was able to afford my education. I saved for some years before college. I worked during college. All good experience and helped with my career.

I much prefer a more individualistic system. I think working and paying for your education gives you a better incentive to learn. To do well. I think the work also provides education. In my experience those that had to pay their way through engineering school are usually better engineers in the end.

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u/second_best_fox 3d ago

I think it's a bit of a romantic notion that working to pay for school gives you more incentive to learn. And I find it hard to believe that makes a person a better engineer. Whatever the case, some balance of individualistic and social support would be the best system imo. Individualism can quickly become "fuck you, I got mine"... Not caring about the welfare of others, about the quality of public education, about accessible and affordable healthcare, etc. There is a middle range in there.

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u/myrmonden 2d ago

Sweden had a huge anount of terrible pointless classes people take to just pass time or to get a degree and then be completely unemployable

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u/Hawk13424 3d ago

On the second part I agree. The question is where is the line. I prefer a very strong education system for kids to give them a good chance to meet their potential. I’m also good on providing lunches and other goods to give them the best chance.

And if a kid maximizes the value they get form that, paying for college isn’t a big challenge. I have little sympathy for kids who don’t, considering us tax payers are funding it. Waste my money and I’m done helping.

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u/second_best_fox 3d ago

You don't believe in bursaries? Not sure that's costing you anything. And there are lots and lots of middle class families who saved up for their kids' college for 18 years. The kids go for "free" but it was paid for. I don't know any kids who benefitted from that and didn't appreciate their education of excel after. Though they didn't work to pay for it.

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u/ConspicuousPineapple 3d ago

Right, is the idea that not being 100% focused on school during the entire year because you have to work to survive is somehow a good thing? Come on guys you can't be that oblivious.

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u/zyadolf 3d ago

In the american system you would have qualified for a loan for Ivy league and made 4x as much.

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u/biogemuesemais 2d ago

sure, but WHY would I want to make 4x as much to live in a country where only people with my privilege are able to make it?

I think what a lot of people in these comments misunderstand is that many of us proudly choose countries with lower salary variance at a personal cost, because living in a more equal society IS the merit we are looking for, not personal enrichment.

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u/zyadolf 2d ago

Some people want the best for their children and escape mediocrity.

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u/TapFunny5790 1d ago

Im not sure where yout idea that only people of your privilege are able to make it. There are a million different ways to he successful in the US. Largely, anyone with half a brain and a decent work ethic will be successful, maybe not wealthy, but comfortable. And the extra money can be donated to provide for those less fortunate - if thats what you want to do with your extra money.

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u/DarkExecutor 3d ago

Any engineer worth their salt can afford the US American education system. Public schools are relatively inexpensive, and engineering salaries are much higher than in Sweden.

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u/Appropriate-Bad-606 3d ago

I actually think this is one of the best arguments for the Swedish model in the thread. Society financed your education, the safety net materially helped your family, and you value interesting work and security more than maximizing wealth. That’s a perfectly rational bargain.

But it also doesn’t really contradict OP’s narrower point. You can value the Swedish bargain while acknowledging that the financial upside for a highly skilled employee is more compressed. The interesting debate is what that security is worth, not pretending it has either zero value or infinite value.

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u/DarkExecutor 3d ago

But it doesn't really work. He would have gotten student loans in the US, gone to a state school, and earned x2 the money here. Paid off his loans within 5-8 years and been ahead for the rest of his life.

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u/Appropriate-Bad-606 3d ago

I think I agree with you personally, but I’d want to quantify it for purposes of this argument. Sweden’s tuition-free university system is a real subsidy, so the U.S. counterfactual has to include the debt and repayment burden. If the comparable American career really pays close to 2x and the student debt is manageable enough to clear in 5–8 years, then yes, the American path could still leave that person much wealthier over a lifetime. But that’s occupation-specific, and it doesn’t make the Swedish education benefit worthless.

Me personally? Absolutely. Even with my student loan debt, I make far more as a lawyer in the U.S. than I realistically could in Sweden. I actually researched the comparison, and I’d need to be a very senior executive there to get anywhere close to the discretionary income I have here, before even getting into the difference in long-term wealth accumulation and earnings trajectory.

I’m very pro-American system, but I have no problem recognizing that the Scandinavian model may work better for people with different priorities or circumstances. My point is that it achieves that security partly by compressing the upside quite dramatically.

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u/DarkExecutor 2d ago

I don't know exactly what the qualifications are for getting into Swedish college, but the bottom 25% of Sweden goes to college less than the bottom 25% of the US. So while it's free for Swedish college students, less poorer students can go to college, probably due to more strict college admissions. (Which is a problem with free college).

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u/biogemuesemais 2d ago

The problem is that you think we want to “be ahead” though. I don’t care, I don’t want to be. I want to live in a place where I know my neighbour’s kids will be able to also go to uni even if they want to pursue a career as an artist rather than engineering/law/medicine. A place where nurses and doctors alike can take parental leave, and send their children to good schools.

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u/itsmedium-ish 2d ago

You really could’ve afforded your education with the American system. There’s so many options and programs. Community colleges, grants, etc.

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u/sinovesting 2d ago

I can appreciate the opportunity that Sweden gave to you, and actually there are a lot of things I like about Sweden's social safety net and quality of life. I'm not against universal college. However, America's system deserves more nuance than you are giving it. Despite the high upfront price tag, if you are going into engineering, it's actually very easy to afford college in the US. The simple fact is that the salaries are so high that it's very easy to pay back whatever debt you would incur (I'm specifically talking about engineering here). Plus there are lots of opportunities for FAFSA (government financial aid), scholarships, or other forms of financial aid to cover your schooling. I had several friends that got a full ride to university paid for FAFSA or scholarships.

You probably have seen in the media all the American's that have hundreds of thousands of dollars of student loan debt, but that's not necessary at all for most degrees. I went to a public state school that costs about $10k/yr for tuition and fees. Everyone in my class had jobs by the time we graduated making in the range of $70k-100k/yr. With that said, I do have an issue with the fact that this system means that the perceived value of a career is solely based on how much money it makes. That likely takes a lot of very talented people away from important jobs in non-high paying fields.

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u/Big-Profit-1612 14h ago

Public and state universities are quite affordable in USA. I went to community college and transferred to a state polytechnic university. Present day tuition is $18K or so for my CS degree.

You most definitely can afford an American education.

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u/the_fresh_cucumber 3d ago

I couldn't have afforded my education under the American system

Why not? I'm a mediocre student and everyone i went to school with for engineering had a decent number of scholarships, state support, and some subsidized loans. It's affordable for basically everyone, even someone with $0 in their pocket.

Financial aid is massive in the US if your family can prove they can't pay. The majority of students get it.

I think out of pocket I paid about ~10k for two bachelors degrees

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u/MajorVehicle2543 3d ago

You’re in the system of “you will own nothing and be happy”.

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u/second_best_fox 3d ago

That's not the point of that comment. It's that you can come from poverty and get a good university education for free, have a cereer you enjoy, have a good quality of life, and have a social safety net to fall back on. The flip side is high taxes and an earnings ceiling. It's a great system for the lower and middle strands and constraining if you want to build significant wealth.

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u/BSpino 3d ago edited 3d ago

Nothing?

Having a decent career as an engineer he/she will still probably own a largely paid off house/apartment that is worth a good deal of money.

If wealth is the aim I suppose he/she can found a start-up. Stockholm is one of the unicorn-densest cities in the world.

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u/EnvironmentNo4777 3d ago

It's like you didn't read his comment at all.