Finland is currently facing a challenging phase in its employment landscape, as indicated by the latest data comparing this October's figures with those of the previous year. Jukka Appelqvist, Chief Economist at the Central Chamber of Commerce, has expressed concern over the declining employment situation, forecasting no imminent improvement.
In October, the number of employed individuals in Finland was 2,605,000, a decrease of 31,000 from the previous year.
This decline is partly attributed to the high comparison level set last year. The employment rate trend for individuals aged 20–64 was 78.0 percent, while the more commonly used trend for those aged 15–64 was at 73.6 percent. The peak employment rates were recorded last year in October and November, reaching 74.2 percent.
Appelqvist commented, “The employment situation isn’t catastrophic yet, but the trend is downward. The peak was last autumn, and since then, we have seen a gradual decline. Unfortunately, this weakening is likely to continue in the coming months.”
The number of unemployed individuals in October rose to 190,000, an increase of 28,000 from the same period last year. The unemployment rate trend has also risen to 7.5 percent, up from a low of 6.5 percent in May 2022.
According to the Ministry of Employment and the Economy, there were 21,200 individuals on full-time furlough in October, an increase of 3,500 from September and 10,300 more than last year.
“The number of furloughs has almost doubled in a year, which speaks volumes about the economic situation. The duration of this difficult economic phase will determine whether these furloughs turn into permanent unemployment. Companies facing a shortage of skilled workers are reluctant to let go of their workforce without substantial reasons,” explains Appelqvist.
In the Statistics Finland labor force survey, individuals on temporary furlough are still considered employed if the furlough has lasted less than three months. Gradually, more furloughed individuals are being recorded as unemployed or outside the labor force, depending on whether they are actively seeking work.
There were 89,400 long-term unemployed individuals in October, defined as those continuously seeking work for at least a year. This is an increase of 1,700 from last year.
“Long-term unemployment has reached a worryingly high level, and we are moving in the wrong direction. Prolonged periods of unemployment always pose a risk, and a significant portion of the unemployed might end up permanently excluded from the labor market,” Appelqvist concludes.