National rules dominate the common Nordic labour market

949 Swedish kronor (€84). That is the cost of a monthly ticket if you commute by train from Malmö in Sweden and as far north as Landskrona – some 45 km away. 

2,670 kronor (€238) is what you pay if you instead choose to commute westwards to a job in Copenhagen – even though the distance is approximately the same.

Region Skåne’s public transport committee is responsible for traffick in Skåne county, while Skånetrafiken according to their website is “an administration within Region Skåne with the mission to offer sustainable travel to everyone who lives, works, and travels in Skåne. All traffic is operated by various companies that have been contracted through competitive bidding”

Öresundståg is one of the commercial actors contracted by Skånetrafik. Photo: Tomas Bertelsen.

The Nordic Labour Journal have asked Skånetrafiken to ask the question so many people have been asking: Why is it so expensive to commute between Sweden and Denmark?

But first, some reflections from two people who live in Denmark and work in Sweden. They are thus part of the minority of 6 per cent and a total of 18,679 people who travel across Øresund to get to work. 

The remaining 94 per cent commute in the opposite direction – from Sweden to Denmark. The figures come from the Öresundsindex from May this year.

Expensive train fares make commuting less attractive 

“I think it has become a problem when prices have risen by 20 to 25 per cent lately for those of us who commute by train. For me, the limit has been reached,” Kenneth Ekberg tells the Nordic Labour Journal.

Kenneth Ekberg is Swedish and lives in Copenhagen – and commutes from there to Malmö. Photo: Tomas Bertelsen.

Since 2016, he has been working at the city office at the City of Malmö. His department is Business and External Relations and it focuses on businesses and promoting sustainable growth in Malmö. 

He specialises in international cooperation and regional development. He considers himself to be well paid “in a municipal context’ as he puts it and has more scope to deal with high ticket prices compared to other commuter groups.

“If you have a less well-paid job for instance in the service industry, where there is a high demand for workers on the Danish side, the high ticket prices become even more burdensome.” 

Expensive and often troublesome as well

Kenneth Ekberg got a job at the Nordic Council’s office in Copenhagen in 2004, and the first year he commuted from Malmö where he then lived. For various reasons, he moved to the Danish capital one year later. 

“I now have a family in Denmark and no plans to move back to Sweden,” he says. 

But there are other things besides high ticket prices that scare people away. Even though the Öresund trains have been crossing the bridge now for 24 years exactly this summer, commuting on them is still not without problems.

“The trains have become safer and more punctual, but when there are issues you sometimes think – what is this? The other day, a train broke down at Malmö C, and all trains between Denmark and Sweden stopped running. Information was also poor,” says Kenneth Ekberg.

Kenneth Ekberg usually gets a seat because he travels against the major traffic into Copenhagen. Photo: Tomas Bertelsen.

The train journey alone from his home to his place of work takes him around 45 minutes. For obvious reasons, there is usually plenty of space on board.

But the journey could have been quicker. When the train has crossed the Øresund Bridge and stops at Hyllie station, the first stop on the Swedish side, it remains there for around seven minutes to allow police to perform border controls.

"I am aware that trains have issues in other places around Sweden as well. But when the train is stuck in Hyllie, it becomes yet another irritation, and it feels like someone is taking seven minutes of my life.” 

He points out that for him personally, commuting between Denmark and Sweden works well in general. It is not only problems, most of the time it works well, he says.

For many years, the Danish bus company Gråhundbus operated route 999 between Copenhagen and Malmö, but stopped during the pandemic and never started the route up again. SJ (Swedish State Railways) also runs trains across the Øresund Bridge but only offers one-way tickets. Choice and competition for public transport across the bridge is, in other words, near zero. 

Currency and residency implications

At the time of writing, 1 DKK costs as much as 1.57 SEK. With such a weak krona, this effectively means a negative wage development for people like Kenneth Ekberg, who lives in Denmark and works in Sweden. 

“Overall, the weak krona eats up the salary increases. I now have a good and interesting job, but if the Swedish krona continues to fall against the Danish krone, it will not be an incentive to commute from Denmark to Sweden,” he says. 

Jesper Jensen commutes – as one of pretty few Danes – to a job in Sweden. 

This is something Jesper Jensen also points to. He has been working for 12 years at Boozt Fashion AB’s headquarters in Malmö’s Hyllie district, where he has risen through the ranks to become Media & Online Marketing Director. He commutes to there from Denmark.

“When I began working in Sweden, the Swedish krona was far stronger than today. As an employee, you take a currency risk, just like the employer," says Jesper Jensen.

The main rule in the Nordic tax agreement is that you pay income tax in the country where you work. Both Kenneth Ekberg and Jesper Jensen use a model called SINK, Special Income Tax for Foreign Residents, and pay 25 per cent tax while they cannot make any deductions. 

“It works fine. I just have to remember to send in a tax return every year,” says Kenneth Ekberg, who in addition to declaring his income has to declare and pay property taxes in Denmark for his house. 

“I have a digital perspective. But that's not how it works for those of us who work in one Nordic country and live in another when it comes to filing taxes. If the Swedish and Danish tax systems were interconnected, I could simply press a button to register that I live in Denmark and work in Sweden, and let the system handle the rest.  

“Instead, I'm required to familiarise myself with both the Swedish and Danish tax systems and manually input all my information," says Jesper Jensen, noting that he has colleagues who pay 6,000 Danish kroner to have an accountant handle their tax returns. 

Like Kenneth Ekberg, Jesper Jensen has a job in Sweden that he enjoys, while his family, relatives and friends are in Denmark. And like Kenneth Ekberg, he is concerned about the train ticket prices.

"It's hard to claim that we have free movement in the Nordic region when it's much more expensive for me to commute from Copenhagen to Malmö compared to commuting to Odense, for example," he says.

He also wants job opportunities in Skåne County to be more visible, explaining that people in Copenhagen often do not consider applying for jobs there. 

“It should be possible to explain in a better way the opportunities that are there throughout the region, and the fact that it's a common job market – even though the challenges need to be reduced," he adds.

New agreements, new opportunities 

Both Jesper Jensen and Kenneth Ekberg welcome the new Öresund agreement which makes hybrid work easier. 

That also goes for Johan Wessman, CEO of the Øresund Institute, an independent Danish-Swedish knowledge centre run as a non-profit organisation.

“It will now become far easier for commuters to work from home in a modern way,” he tells the Nordic Labour Journal. 

With the new agreement, tax residency is based on a full calendar year rather than the previous three-month period. This reduces the risk of needing to declare and pay taxes in both Denmark and Sweden within the same year. 

"The new agreement affects many, but not all. Some jobs require a physical presence, such as at Copenhagen Airport, in public transport, healthcare, and at shops, restaurants, and hotels," says Johan Wessman. 

A system shift for cross-border discussions

A new Øresund agreement also holds significant symbolic value, he believes, pointing out that the discussion on what needs to change to create better conditions for cross-border commuting has moved from a regional to a national level. Both countries' governments are taking concrete actions to show they consider the Øresund region important.

"Suddenly, we have broad support that has triggered a system shift. The discussions are no longer confined to a regional level. Now, we have a situation where Nordic ministers, other ministers, businesses, the Swedish and Danish ambassadors, the Øresund Bridge and the regional Danish-Swedish political cooperation in Greater Copenhagen are all participating in discussions, which is very encouraging," says Johan Wessman. 

The pricing

This is how Skånetrafiken answers the Nordic Labour Journal’s question about the pricing of travel across Øresund:

Why does it cost so much more to travel to Denmark than for a similar journey within Skåne county?

“The pricing, the so-called Øresund fare, is a cooperation between Skånetrafiken and DSB [Danish State Railways] and uses a completely different way of pricing compared to on the Skåne side of the sound.

“Ticket fares are basically made up of three parts – one Swedish part, the bridge part adn a Danish part. Unlike the Skåne system, which is based on distance, the Øresund fare system is build on so-called “big zones” and that is why the pricing is different. A ticket between Hyllie and Kastrup Airport Copenhagen is valid in the zones FL and A, and not only for the distance you travel.

“When this system was set up at the time of the opening of the bridge, a ticket between Sweden and Denmark cost 70 kronor (€6) while a city bus ticket for a similar distance cost 14 kronor (€1), so there has always been a price difference in the system. 

“The exchange rate also influences the pricing of tickets to Denmark. Since tickets should cost the same regardless of which currency you use, we adjust the prices in accordance to the value of the Swedish and Danish krone. This too has an impact on prices.”

Why have ticket prices to Denmark risen so much lately?

“We take three things into account when we adjust prices: price rises on the Danish side, price rises on the Swedish side and currency differences.

“On the Swedish side, the regional council has decided that price rises should be linked to CPI, while on the Danish side, the prices are set based on other factors. When we adjust prices according to CPI, the most expensive tickets in our range (i.e. tickets to Denmark) receive a higher increase in kronor than the cheapest tickets, even if the percentage increase is the same. However, the main “culprit” is the exchange rate differences. The Swedish krona’s development alone has meant that prices have gone up.”

The Øresund Bridge is financed by the users. When it has been paid off, what will that mean for ticket prices?

"Ticket prices are basically a political decision so Skånetrafiken cannot speculate on future ticket prices for crossing the bridge. 

"Region Skåne is also not the only responsible stakeholder, since there is an agreement with the Danish state at the root of this. It is also important to remember that there are more parameters besides the actual bridge that affect pricing.  

"The bridge can also not be viewed separately from a Skåne perspective because the revenue Region Skåne receives from Öresundstrafiken is part of Skånetrafiken's total budget. 

"If this revenue were to decrease, the funds would need to be sourced from elsewhere, i.e. from the Skåne region. Since Skånetrafiken's revenue is roughly evenly split between ticket sales and regional subsidies, a reduction in bridge ticket revenue would require compensatory increases in ticket prices in Skåne, higher regional taxes, or a combination of both.