Finnish unemployment rate likely to continue falling

Finland’s jobless rate has been falling gradually since last autum. This shows the fragile economic rebound. In April, Finland’s seasonally adjusted jobless rate fell to 9.1 percent. The number of private sector employees had increased in April on year-on-year terms, in spite of several lay-offs news in the media. Public sector employees’ number, particularly in the central government, has fallen.

In all, the labor market development has been better than anticipated and is one of the upside surprises that is seen in Finland this spring, said Danske Bank in a research report. Finish unemployment is lower than the average of euro area when compared with the euro zone even when the Finnish economic development has been weak.

However, there are certain concerning underlying trends in spite of a fall in unemployment. The number of long-term employed has been rising. A total of 132,000 long-term jobless people have been registered till now in Finland and this is the highest number since 1998. Meanwhile, the number of people in disguised unemployment has increased by two-fold since the beginning of the recession. These facts show that there is a rise in structural unemployment.

“We forecast the average unemployment rate to be slightly lower in 2016 (9.2 percent) than it was in 2015 (9.4 percent). In 2017 we expect unemployment to decline slowly to 8.9 percent assuming that the economy will recover”, added Danske Bank.