Tell me, is this normal in Swedish workplace culture?

Someone at Workplace A contacts a professor of mine asking if he could recommend anyone to take on a part-time position in somewhat of an urgent situation. He recommends me. I send an e-mail and CV to the person. The person writes back saying thanks and she will pass on my info to her boss. I don’t hear anything more. Not a big deal really, I’ve actually got plenty going on at the moment.

Weeks later I am at a former workplace of mine, discussing the possibility of filling in for someone for a few weeks. The person I’ll be filling in for says to me “I heard you applied for a job at Workplace A”. It turns out that the wife of someone at Workplace B works at Workplace A.

Why does everyone know that I applied for that job? I find this very weird and kind of unethical. For me, it is mildly embarassing that everyone knows that I applied for a job that I didn’t get, particularly since I wasn’t even really looking for that job in the first place, I applied because I was asked to. Worse, though, I can imagine situations where this kind of gossip could be really destructive. What if a person is looking for a new job but his/her employer doesn’t know and the employee intends to stay at the current job if they don’t get a new one? Are Swedes so advanced that a boss would never develop a negative attitude toward an employee after finding out that that employee wanted to leave?

So Swedes and experienced residents of Sweden, is this kind of thing normal here or have some kind of workplace ethics or laws been breached?