Finland’s job market faced a significant downturn in February, with employment dipping by 64,000 compared to the same period last year and unemployment rising to its highest point since 2016.
Data from Statistics Finland indicates that the employment rate for individuals aged 15–64 fell to 71.4 percent. The overall unemployment rate for those aged 15–74 increased to 9.1 percent, reflecting a two-tenths rise from January.
Henna Busk, a senior economist at Pellervo Economic Research (PTT), described these statistics as “bleak,” emphasizing the sharp drop in employment and the ongoing rise in long-term unemployment.
Busk highlighted declining employment in the public sector as a major contributing factor. “The private sector has remained relatively steady, but there are still no indications of growth,” she noted.
The decline in employment was particularly pronounced among women. In contrast to February 2024, the number of employed men decreased by 7,000, whereas the figure for employed women plunged by 58,000. This disproportionate decline is attributed to budget reductions in government and regional services that typically employ a higher percentage of women.
Despite the overall bleak outlook, the working-age population continued to grow slightly, offering a rare glimpse of stability.
Jukka Appelqvist, chief economist at the Finland Chamber of Commerce, expressed that previous signs of improvement at the beginning of the year now seem to have been fleeting. “Those figures were too positive to be authentic,” he stated. “Recovery in the job market hasn’t commenced yet.”
Appelqvist pointed out that both key employment indicators are now declining. The employment rate for the 20–64 age group stood at 76.0 percent, also down from earlier statistics. Revisions were also applied to previous months’ data, adjusting previously optimistic figures downward.
February saw 263,000 people unemployed, an increase of 43,000 year-on-year. The last time unemployment reached this level in February was in 2016.
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While Appelqvist believes the peak of the current unemployment cycle may be approaching, he cautioned that recovery will be sluggish. “This unemployment level keeps household spending restrained, which in turn delays recovery in domestic demand,” he noted.
According to the Ministry of Economic Affairs and Employment, employers reported just under 50,000 job vacancies in February. This figure still falls significantly short of the average.
Nonetheless, Appelqvist suggested that there may be grounds for cautious optimism. “The job market remains weak, but the worst might have passed in the latter part of last year. There are faint indications of a gradual recovery,” he added.