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North Central Sweden – Universities and clusters as regional drivers

For several years, the level of economic growth in the region of North Central Sweden has been low and regional assets in terms of education and business R&D are below EU average. To stimulate growth and innovation, regional actors from the public sector, universities and cluster organizations have initiated an active collaboration across industries and sub-regions.

The region Northern Central Sweden (NUTS 2 – Norra Mellansverige) is a sparsely populated region with a GRP per capita slightly above the EU27 average. The region is well endowed with national resources and has traditionally been dominated by capital intensive export industries, such as pulp and paper, steel and engineering, machinery and transport vehicles. However, global structural changes have resulted in outsourcing, reduced employment and international mergers and acquisitions and the growth rate has been low for many years. Employment in high tech industries and knowledge intensive services is rather low, and the share of the population with a higher education, as well as annual business R&D expenditure, is below the EU average.

An important instrument for regional innovation in Northern Central Sweden has been the support of clusters and innovation systems. This has been a way of assuring critical mass in terms of funding and competence development in sectors of regional importance. To support not only traditional industry sectors, but also new services sectors, and to stimulate competence development, the report presents several regional policy initiatives.

Broaden the innovation capacity

To reduce the present dependency on a few capital intensive export industries, a great challenge for the region is to stimulate innovation that leads to new jobs and business development. During the last decade, a cluster policy framework has been implemented, to support the development of prioritised clusters in the region. However, to avoid path dependence and lock-in effects, it is necessary to support not only the dominating industry sectors, but to stimulate cross sector collaboration and development of new sectors, contributing to a broader industry base for innovation with potential for smart specialisation. This development has been supported by the ERDF co-funded SLIM project (System Management for Innovative Platforms and Cluster Organisations), a cross regional collaborative platform for cluster develop­ment.

Increase employment in the services sector

To increase regional resilience, attention to service sectors has increased, even if employment in the regional service sector is still below the national average. It has therefore become increasingly important to support the development of entrepreneurship and growth in the service sector, e.g. knowledge intensive service, tourism, creative sectors and health care. Several policy measures have been applied, including stimulating university research, establishment of new cluster organisations and incubators, and projects directed to specific sectors.

Improve the access to competence

A third challenge is to improve access to relevant competences in the labour market. In the ICT sectors, for example, companies in the region are experiencing problems to recruit personnel. Due to the demographic development, with a limited population growth and an aging population, this problem may increase in the future. This raises the question on how to increase the level of higher education in the regions, particularly among young male. Since this is a question of changing attitudes and increasing the interest in higher education, various activities have taken place to reach out to young persons, e.g. providing experiments for kids, develop attractive programs at various levels and to invite business representatives to participate in research and education. At Karlstad University, the regional authority Region Värmland is co-funding ten professorships, based on regional priorities and business dialogue. Many activities are implemented by the regional cluster organisations to secure future competence in the labour market.

Implications for future policy

Even if the concept of smart specialization has not been formally implemented in regional innovation policy in all Counties of Northern Central Sweden, the need for combining regional specialization with collaboration between sectors and across county, region and national borders has been identified as important for future competitiveness. In summary, the report identifies the following opportunities for possible future actions.

  • First, support the development of related diversity and smart specialization, building on the potential for innovation and entrepreneurship in the intersection between clusters and competence areas.
  • Second, increase global knowledge flows and the regional influence on national policy design and implementation, by continuing the collaboration between regional, national and international actors initiated through the SLIM project.
  • Third, continue the on-going process of supporting the development of service-based sectors, to broaden the bases for regional innovation and entrepreneurship.


Maria Lindqvist

Senior Research Fellow