The Swedish unemployment rate declined by 0.2 per cent in October, according to the Scandinavian country's statistics agency.

Statistiska Centralbyran revealed that the national jobless rate fell to 8.1 per cent last month, which is equivalent to an increase of 0.4 per cent year-on-year.

In addition, the data bureau disclosed that total employment in Sweden fell to 4.58 million individuals in October from 4.478 million in September, while working hours declined by 4.2 per cent compared to last year's figures.

Roger Joseksson, economist at the Danske Bank Group, suggested that the unemployment figures are misleading.

He told Reuters: "The labor force is diminishing rapidly, with a higher number of people who are outside the labor force - not actively looking for a job - and that pushes down the unemployment rate."

Last week, Sweden's finance minister Anders Borg raised the country's gross domestic product forecasts for 2009 to a contraction of 4.9 per cent, offering hope to the country's businesses of an imminent recovery.