Jarkko Eloranta, the chairperson of the Central Organisation of Finnish Trade Unions (SAK), spoke to reporters following a press conference concerning the development of the labour market system in Helsinki on 16 January 2024. Eloranta on Wednesday told YLE that it may take a while to re-align the labour market situation to the benefit of wage earners. (Antti Aimo-Koivisto – Lehtikuva)


UNREST in Finnish labour markets is set to continue, with both the government and trade unions adamant in their points of view.

Minister of Employment Arto Satonen (NCP) stated on YLE A-studio on Wednesday that there is room for the dispute parties to negotiate on the details of local bargaining and industrial peace legislation, for example.

The government will unveil its proposal on local bargaining today, according to him.

Jarkko Eloranta, the chairperson of the Central Organisation of Finnish Trade Unions (SAK), described the situation as highly acrimonious, adding that it is eroding trust capital between the sides.

Both Eloranta and Satonen declared that they have no intention of backing down in the dispute over the labour market reforms and social security cuts outlined by the government, the former gauging that it could take a while to turn around the situation to the benefit of wage earners.

“If the government moves forward with its proposals, the next round of collective bargaining talks and probably the next parliamentary elections are where we’ll seek to turn things around,” he said.

Satonen stated on YLE Radio 1 earlier yesterday that the government is neither intent on walking back its proposals, nor considering the price tag of the widespread political strikes that have disrupted manufacturing operations, port operations and public transport this week.

“We won’t be thinking about any limits because these are long-term reforms,” he said, adding that trade unions should think seriously about the costs and consequences of their actions. “They’re only digging a deeper hole that’ll be left for everyone to pay.”

The strikes, he warned, could force companies to initiate consultative negotiations and result in job losses.

Satonen also argued that the widespread industrial actions demonstrate the need to restrict the right to organise political strikes. The government is presently drafting a bill that would limit the duration of political strikes to a single day and decree that only one political strike can be organised over a particular issue.

“We’ll be allowing political strikes also in the future, but we need rules to make sure they don’t cause the kind of harm to the national economy we’re seeing now.”

Lauri Vuori, an economist at the Confederation of Finnish Industries (EK), told YLE on Wednesday that the recent strikes have been costly especially for manufacturing companies, such as steel mills and certain chemical industry companies, creating losses of 380 million euros.

EK estimated earlier that the strikes organised in the past couple of months have already cost the national economy roughly a billion euros. Jyri Häkämies, the director general at EK, told Helsingin Sanomat on Wednesday that half of the total stems from the three-day strikes witnessed last month, the other half from the strikes organised this month.

Vuori revealed to the newspaper that the estimates are based on the number of employees participating in the strikes and their impact on production. Any loss of production is then converted into commensurable gross domestic product effect.

Other economists, however, do not believe the calculations are that straightforward, especially with the economic downturn complicating the process.

Päivi Puonti, the director of forecasting at Etla Economic Research, reminded Helsingin Sanomat that almost half of manufacturing companies estimated at the end of last year that they have excess capacity relative to demand. If such companies have already scaled down production, she explained, it may not be too challenging to make up the production lost due to a one or two-day strike.

Meri Obstbaum, the director of forecasting at the Bank of Finland, similarly pointed to the economic situation and low capacity utilisation rate as confounding factors.

“Of course the impact is negative, but if the strikes are short the impact may be very temporary,” she analysed for the daily newspaper. “In any case, the economic situation and capacity utilisation rate are low in manufacturing.”

Also trade unions have raised questions about the calculations.

“Typically they’re completely overblown,” Ismo Kokko, the chairperson at the Transport Workers’ Union (AKT), stated to YLE on Wednesday. “It’s not as if leaving goods in a container in a port for three days means you’ve lost them for good.”

The economic impact of public-sector strikes, such as those in kindergartens and public transport, is even more difficult to determine, according to Helsingin Sanomat.

“The effects are nearly impossible to estimate even in hindsight because it’s very difficult to isolate them from other factors affecting the economy,” explained Juho Koistinen, the head of forecasting at the Labour Institute for Economic Research (Labore).

Aleksi Teivainen – HT