Nordic Day 2024 - current economic state of the Nordics

The “Nordic Constitution”, the Helsinki Agreement, was signed on March 23rd, 1962. Since then, Nordic Day is celebrated every year, to mark the Nordic co-operation, the oldest regional political co-operation in the world. It includes Denmark, Finland, Iceland, Norway, and Sweden as well as the Faroe Islands, Greenland and Åland.

Created in the years after the Second World War, one of the aims was for the Nordic countries to create security and preserve democracy and peace. The collaboration has grown over the years and today many political areas are handled, with the aim for the Nordic region to be the world's most sustainable and integrated region by 2030.

How is the region doing today? This can be measured in many ways. In this short article the focus will be on the current economic state of the Nordics. Three indicators – inflation, GDP growth and unemployment - will be presented for Denmark, Finland, Iceland, Norway and Sweden. [1]. For more indicators illustrating the current economic state, see the Nordic Statistics Dashboard on the Current Economic State in the Nordic Statistics Database.


The timeline in the figure below shows the inflation rate, measured by the Harmonised Index of Consumer Prices (HICP), from March 2021 to January 2024.

The inflation rate started increasing in all five presented Nordic countries in the beginning of 2021. All countries, except Iceland, then had their peak rate in the fourth quarter of 2022 – Denmark (11.4%) and Norway (8.4%) in October, Finland (9.1%) in November and Sweden (10.8%) in December. This development corresponds well with that of the EU (peak in October of 2022, 11.5%). In the following year, the rates declined quite steadily before becoming more volatile and more diverse in the fourth quarter of 2023.

Iceland had its peak rate (8.8%) in February of 2023, but did not have the same decline as the other four countries after the peak – the rate then remained quite steady before starting to decrease in October 2023.

In January 2024, the HICP inflation rate increased slightly again in Denmark (from 0.4 to 0.9%) and Sweden (from 1.9 to 3.4%), while decreasing in Finland (from 1.3 to 1.1%), Iceland (from 6.9 to 5.6%) and Norway (from 4.7 to 4.6%).

Source: Nordic Statistics Database, KEY03

Inflation is the general increase in the overall price level of goods and services typically bought by households (citizens). It is measured as the average price change over a given period of time for a basket of goods and services that are typically bought in the economy. In Nordic Statistics, Harmonised Index of Consumer Prices (HICP) is used, the standard in the euro area. The index reflects the change in general price development between the current month and the same month of the previous year. [2]

GDP Growth

The timeline shows economic growth, measured by percent change in Gross domestic product (GDP) compared to the previous quarter from Q4 2020 to Q4 2023 [3].

Since the fourth quarter 2020, the average growth rate for the five countries have varied between 0.1% (Finland) and 1.4% (Iceland), but all have experienced at least one quarter with negative growth. The average growth rate in the EU was 0.6% in the same period.

In the fourth quarter of 2023, the economic growth rate was negative in two of the four countries for which data was available, Finland (-0.7%) and Sweden (-0.1%). In Denmark (2.0%) and Iceland (0.9%), it was positive.

At the same time, the development of the growth rate was positive compared to the previous quarter in three of them: Denmark (from 0.4 to 2.0%), Finland (from -1.1 to -0.7%) and in Iceland (from -2.5 to 0.9%). Denmark stands out with two consecutive quarters of increase. In Sweden, as well as in the EU, GDP growth was unchanged (at -0.1% in Sweden and at 0.0% in the EU).


Source: Nordic Statistics Database, KEY02

Economic growth refers to an increase in the size of a country's economy over a period of time. The size of an economy is typically measured by the total production of goods and services in the economy, the gross domestic product (GDP). Here, chain-linked volumes are used. This is a measure of the real growth, adjusted for inflation and therefor showing increases in the volume produced only. It reflects how much a country is producing at a given time, compared with other points in time.


The timeline shows unemployment rate, in percent, from March 2021 to January 2024.

Worth noting is that the Nordic countries are divided into two groups when it comes to unemployment rates in the reported period. Sweden and Finland have very similar curves, with average monthly rates at 7.2% (Finland) and 8.0% (Sweden). In the same way, the development of unemployment in Denmark, Iceland and Norway share many similarities, with averages at 3.7% (Norway), 4.2% (Iceland) and 4.8 (Denmark). Denmark has, however, had a higher increase in unemployment in the second half of the period than the other two. The average unemployment rate in the EU was 6.3% during the same period.

In January 2024, the unemployment rate increased in Denmark (from 5.0 to 5.3%), Finland (from 7.5 to 7.7%) and Norway (from 3.5 to 4.5%), while remaining steady in Sweden (at 8.2%) as well as in the EU (at 6.0%). No January values are available for Iceland.


Source: Nordic Statistics Database, KEY03

Unemployed persons are defined as the percentage of active population constituted by persons aged 15 to 74 who: are without work; are available to start work within the next two weeks; and have actively sought employment at some time during the previous four weeks. Data originally comes from the Labour Force Survey (LFS).


For more economic indicators, please see the Nordic Statistics Dashboard on the Current Economic State. These nine indicators are updated monthly, to give the latest trends on the Nordic economic development.


[1] No quarterly or monthly data on this subject is currently available in the database for Greenland, Faroe Islands or Åland, but work is ongoing.


[3] Chain-linked volumes. Seasonally and calendar adjusted. Data for Iceland are seasonally adjusted and not calendar adjusted.