[2] The incumbent Social Democratic minority government, led by Göran Persson, was returned to power despite losing seats and receiving fewer votes than in their 1991 defeat.

This reflected how many Social Democratic voters were dissatisfied with the policies of the government, which had implemented austerity measures to reduce the budget deficit.

The Social Democrats were able to form a government in spite of the sizeable decline of the vote, since the centre-right parties failed to recover more than a net share of 11 seats out of the required 27.

Even so, smaller municipalities away from the bigger cities gave the red-green bloc a sizeable edge, with the Left Party getting into double-digits nationwide.

For the Social Democrats, the steep drop of the party's nationwide vote share was still felt in many of its historically strong industrial areas.