High Voltage, Uneven Impact: Local Labor Market Adjustments Following The Establishment of a Battery Factory in Northern Sweden

Karin Zimmerman ()
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Karin Zimmerman: Department of Economics, Umeå University, Postal: Department of Economics, Umeå University, S 901 87 Umeå, Sweden, https://www.umu.se/handelshogskolan/

No 1044, Umeå Economic Studies from Umeå University, Department of Economics

Abstract: This paper investigates the short-run labor market effects of a major industrial investment, using the announcement of a large battery factory in northern Sweden as a case study. Applying the synthetic control method (SCM) with three counterfactuals and disaggregating results by sector and gender, the analysis uncovers uneven adjustments beneath stable aggregate employment. Public sector jobs falls markedly – driven by a 5.6% annual decline among women – while manufacturing and construction show only minor changes. The effect on income is modest, with small gains for men in manufacturing. The findings show that such investments can trigger short-term labor reallocation rather than immediate job creation, particularly in regions with tight labor markets and demographic stagnation.

Keywords: Industrial Investments; Local Labor Market; Synthetic Control Method; Gender Disparities; Sectoral Employment Shifts (search for similar items in EconPapers)
JEL-codes: J21 J24 J31 O18 R23 (search for similar items in EconPapers)
Pages: 70 pages
Date: 2026-02-06
New Economics Papers: this item is included in nep-lma
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