economy, despite the slowdown in economic activity. moreover, there are tendencies towards demands for compensation, which, if they were to spread, could provide further complications for wage formation. the trends with regard to labour supply are also worrying. demographical developments, such as an increasing number of elderly people over the coming decade, will create a demand for more employees to work in geriatric care, for instance. at the same time, the number of persons available on the labour market is declining. an addition problem is the high frequency of absence due to sickness. it is evident that a central target for economic policy should be to get more people in work. this would facilitate wage formation and create greater scope for economic growth in future. this is perhaps just as important a theme for a hearing in the committee on finance as wage formation in itself. it concerns measures that are largely in the hands of the riksdag. thank you!

a midpoint of 6. 25 per cent ( to be compared with the ministry of finance ’ s corresponding estimate of 5 per cent ). the riksbank uses as a base in the first stage the average rate of unemployment during the period 1999 – 2006, that is, about 7 per cent, which is then made into a midpoint in the estimated interval of 6 – 7. 5 per cent. this can be regarded as an estimate of long - run sustainable unemployment up to 2006, before the government ’ s reforms. however, the estimate disregards the fact that average inflation has undershot average inflation expectations. as i explain in an annex to the minutes from the meeting in july 2012 ( svensson ( 2012a ) ), this difference between inflation and inflation expectations means that average unemployment becomes a biased estimate of the long - run sustainable rate of unemployment. when i take this difference into account, i reach the conclusion that the bias is approximately 0. 75 percentage points. all else being equal, the riksbank ’ s estimate should then be reduced by 0. 75 percentage points, whereby the riksbank ’ s final interval after the adjustment will be 4. 25 – 6. 75 per cent, with a midpoint of 5. 5 per cent. the estimates made by the ministry of finance and the national institute of economic research do not take into account the fact that average inflation has been lower than inflation expectations, either, so their estimates may also need to be adjusted downwards bis central bankers ’ speeches somewhat. the average of the ministry of finance ’ s and the national institute of economic research ’ s estimates so far and of the riksbank ’ s estimate after my adjustment is in any case be 5. 5 per cent. while awaiting new estimates that take into account the bias that average inflation lower than average inflation expectations entails, i will use 5. 5 per cent as my own assessment of long - run sustainable unemployment. more expansionary monetary policy can reduce unemployment can a less tight monetary policy really reduce unemployment in our present situation? i think it can. expansionary monetary policy improves matching … it is often said that the matching of jobseekers to job vacancies is not functioning as well now as it did before, and that monetary policy cannot do anything about this. 17 the discussion in the fiscal policy council ’ s report for 2012 ( fiscal policy council 2012 ) is relevant in this context. this shows that matching for both experienced and inexperienced labour is sensitive to demand fluctuations and