Self-Employment Among Immigrants
in Sweden – An Analysis of
Small Business Economics
23: 115–126, 2004.
2004 Kluwer Academic Publishers. Printed in the Netherlands.
ABSTRACT. This paper examines intragroup differences in
self-employment within different immigrant groups and the
native population in Sweden with the help of 1990 Census
data. Intragroup differences are observed among all the groups.
The study shows that differences in self-employment rates
between individuals with different educational attainment exist
for some of the immigrant groups. For immigrants from
Southern Europe and non-European immigrants as well as for
natives, the propensity for self-employment is lower among
individuals with higher education. Furthermore, the study also
shows that there are intragroup differences defined by gender
and point in time for immigration. Finally, the study observes
small differences in self-employment earnings within the
different immigrant groups.
During the post-war years immigration to Sweden
increased rapidly. In 1940 about 1 percent of the
total population living in Sweden was made up of
foreign born individuals. In 1970 the share had
increased to about 7 percent. In 2002 the corre-
sponding figure amounts to about 11 percent, or
about 1 million individuals. During the 1950s and
1960s immigration to Sweden was primarily
labour force migration. Labour force immigrants
came almost exclusively from the Nordic coun-
tries and Southern Europe. From the mid-1970’s
and ahead the character of immigration changed.
The proportion of refugees and “tied movers” from
countries outside Europe increased markedly.
This has led to a change in the composition of the
immigrant population in Sweden over the years.
In 1970 about 60 percent of the foreign born
population living in Sweden were born in the
Nordic countries, and about 30 percent were born
in other European countries. In 2002 about 30
percent of the foreign born population living in
Sweden were born in the Nordic countries, about
35 percent in other European countries and almost
40 percent were born in countries outside Europe.
In the light of the labour force migration it
might be expected that immigrant self-employ-
ment would have been a marginal phenomenon in
Sweden during the years. However, this is not the
case. In contrast to native small-sized businesses
immigrant self-employment has increased over the
years and the self-employed sector has thus
become a source of employment that plays an
important role in the assimilation of immigrants.
Previous studies have shown that the self-employ-
ment rate varies between different immigrant
groups in Sweden and that for many immigrant
groups it exceeds the self-employment rate among
natives (see Lindh and Ohlsson, 1996; Ekberg,
1997; Scott, 1999; Hammarstedt, 2001).
The fact that the self-employment rate varies
between different ethnic groups has been observed
in many countries (see Borjas, 1986; Yuengert,
1995; Fairlie and Meyer, 1996; Le, 1998), but little
attention has so far been paid to intragroup dif-
ferences in self-employment, that is, differences
within an ethnic group. Since it is reasonable to
believe that members of the same immigrant group
are not homogenous in their sociocultural back-
ground, an intragroup approach suggests the pos-
sibility of dividing immigrants from the same
ethnic group into different categories and com-
paring various aspects of self-employment activi-
ties based on these categories. Fernandez and Kim
(1998) studied self-employment among four Asian
Final version accepted on May 27, 2002
Centre of Labour Market Policy Research
S-351 95 Växjö