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The average unemployment rate in EU member states is around 6%, but Finland’s unemployment rate has climbed to over 8%.
Finland’s employment situation is one of the weakest in the European Union, according to a report released by Statistics Finland on Tuesday.
According to the latest data, the average unemployment rate in the European Union is about 6%, while Finland’s unemployment rate is as high as 8.4%.
Only Spain (11.5) and Greece (9.6) have higher unemployment rates.
However, the Finnish Statistics Bureau report also pointed out that employment data in Spain and Greece have improved over the past year, while Finland’s employment rate has further deteriorated, and the short-term outlook looks even bleaker.
Jenny Hovari The Treasury told Yle that the government’s austerity measures — Announced earlier this year ——It may lead to a further increase in the number of unemployed people.
With Finland’s economy in the midst of anemic growth, reforms aimed at encouraging people to work, such as cutting housing subsidies and phasing in unemployment benefits tied to earnings, could actually have the opposite effect in the short term.
“If there is insufficient demand for labour, unemployment could rise,” Hovari said.
The government has set a target of creating 100,000 new jobs during its term, but Huovari admitted achieving that would be “challenging”.
“There has been a setback here and it will now take longer to achieve employment targets. But if the economy picks up, employment will also grow rapidly,” he said.
He added that the impact of many of the government’s reforms will only start to be felt early this year, while others may not have a noticeable effect for several years.
Why is Finland below the EU average?
Huovari believes there are several reasons why Finland lags behind most other EU countries.
First, economic growth in Finland has been slow compared with other countries, in part because Finland is more sensitive to changes in interest rates.
This means that rising interest rates will have a greater negative impact on the Finnish economy than in other EU member states, especially as floating interest rates are more common in Finland for both housing and business loans.
On the other hand, however, lower interest rates will stimulate economic growth in Finland faster than elsewhere.
Khovari also noted that Finland suffered more economically from Russia’s invasion of Ukraine than most EU countries.
A third reason is that Hovari believes that immigration to Finland remains strong even as the job situation worsens.
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