Tuesday. 26.09.2023

OECD’s research 'Faces of Joblessness' examined employment patterns of working-age individuals (17-64) in Finland over the course of 2017 based on EU-SILC data.

According to the Ministry of Social Affairs and Health, the study identifies 8 faces of joblessness in the country and provide a map of the characteristics and employment obstacles of jobless people in Finland. The results will give insight on the social security reform. 

Results in the report show that 27% of the working-age population face labour market difficulties. They are the target group of the report. Of the working-age population 18% did not work at all throughout the year, while a further 9% were only weakly attached to the labour market. They were occupying unstable jobs, working limited hours, or earning very little.

The research maps out the main groups of individuals in Finland with similar support needs and identifies eight groups of people characterized as: 

  • Individuals who are no longer looking for work and largely live in rural areas (26% of the jobless).
  • Individuals in unstable or intermittent employment and with limited employment barriers (20%).
  • Early retirees with comparatively high skills but limited financial work incentives (12%).
  • A group of mostly men, living in rural areas and actively seeking work despite health limitations (11%).
  • Women with significant care responsibilities (10%).
  • Young low-skilled individuals (9%).
  • Prime-aged low-skill individuals (8%).
  • Individuals with significant non-labour income (4%).

Health limitations

The report distinguishes 3 types of employment obstacles: barriers related to work capacity (skills, work experience, health, care responsibilities), incentive barriers (resulting from tax and benefit provisions or because of the availability of significant incomes that do not depend on own work effort) and job search barriers (for example, limited availability of job offers).

Results indicate that health limitations, unsuccessful job search, and the availability of significant non-labour incomes are particularly prevalent in Finland, affecting 45%, 30% and 28% of the jobless population, respectively.

“Compared to other OECD countries, a large proportion of Finland’s jobless report poor health as a barrier to employment. Further work will be needed to unpack what is going on here, in particular the role played by mental health”, says economist and researcher Emily Farchy from OECD.

According to the research, many jobless Finns are confronted with complex and inter-related employment obstacles. Close to 70% face two or more employment barriers at the same time, and this share rises to 87% for those who are persistently out of work for 12 months or longer. According to the research 39% face three or more barriers.

For those with multiple barriers, policies focusing on addressing a single employment barrier in isolation may not have the intended effect on labour-market outcomes, the research suggests.

“In Finland, social benefits reach those most in need. However, especially in the context of the current crisis, it is essential that employment support is equally well targeted, and adapted to the multiple barriers that jobless people face”, states Stefano Scarpetta, Director for Employment, Labour and Social Affairs at OECD.

27% of working-age population has difficulties finding employment