Cross-National Comparison of Post-Cold-War Defense Conversion and Labor Policies: Sweden and the United States

Defense and military priorities have changed in the post-Cold-War era in many nations. Decreases in military and defense spending have resulted in layoffs in defense-related industries, creating dislocated defense-dependent workers and affecting economic and social conditions in their communities. How countries cope with the labor repercussions of restructuring in defense differs across nations. Their policy choices are rooted in the historical and institutional paths of their political economies. In this paper the author compares defense restructuring and its effects on workers through an analysis of policies in Sweden and the United States. Both the United States and Sweden have maintained strong military and defense sectors, for different reasons, but demonstrate most-different systems design with regard to labor policies affecting a dislocated workforce. It is argued that the dominant ‘warfare’ state policies of the United States forced the country to develop a set of reactive policies to defense restructuring, more focused on technology and existing defense firms than on the retraining and reemployment needs of its former defense workforce. Sweden's welfare state model, by contrast, enabled defense-sector dislocations to be treated in the same way as other industrial restructuring in the past, by a set of well-developed labor and social policies that encouraged retraining and reemployment of workers. Case studies from both nations highlight these differences. The anticipatory policies in Sweden were better able to cope with structural changes from defense restructuring than were the largely reactive policies of the United States.