Allocating job losses: the mass layoffs at the Swedish Tobacco Monopoly in 1921

Abstract

This article analyses the mass layoffs carried through by the Swedish Tobacco Monopoly in 1921. As a state-owned enterprise, the Tobacco Monopoly was expected to treat its employees with particular care but was not restricted by formal rules regarding the order of selection. Drawing on both qualitative and quantitative evidence, it is shown that the company's layoff policy shifted dramatically over the course of the year. In the spring, the company acted according to existing praxis and applied the seniority principle when releasing workers. In the autumn, when machines for cigar production were about to be installed, the same principle was abandoned. This policy shift should be seen in the light of technological change. As cigar machines were introduced, the company no longer needed experienced workers for training new workers. The seniority principle for layoffs was never applied again in the industry for the rest of the inter-war period.