Ministry predicts Finland will lose 100,000 industrial jobs in ten years

Experts see future in service sector, but some parts of industry should also do well

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Finland is set to lose 100,000 jobs in industry in the coming ten years, suspects Markku Wallin, Chief of Staff at the Ministry of Labour. In his view, Finland hardly has any means to fight against the trend.
      Recent announcements of closures of industrial facilities seem to confirm the trend. However, the situation is not quite so simple. Several experts believe that Finland still has ways of dealing with problems related to globalisation.
      In spite of the decline in industrial jobs, Finland could face a serious labour shortage before 2020, and the employment rate has already improved this year.
     
The global redistribution of industrial production is rapidly turning Finland into a service society. In the 1990s about 80,000 new jobs were created in Finnish industry, but in the past four years half of them have disappeared, as production has been moved to countries with lower labour costs.
      Finns use services considerably less than other Europeans. However, economists believe that business services offer Finland new opportunities to compete on the global market.
      Business services range from consulting to services linked with industrial products, such as maintenance agreements connected with the purchase of elevators or office equipment.
      In addition to the service sector, employees in at least the electronics industry, the chemicals industry, and engineering appear to have a bright future in Finland.
      In spite of the current labour dispute, the paper industry is likely to remain in Finland; massive investments into the sector make it impractical to relocate, and the proximity of sources of raw material - Finnish forests - is also a major factor.
      "A surprise sector for the future is the rubber and plastics industry, where employment could even increase in the coming years", predicts researcher Anthony de Carvalho of the Research Institute of the Finnish Economy (ETLA).
     
Economists point out that the "China Syndrome" linked with globalisation will not necessarily lead to a net loss of jobs in Finland.
      "People often think that industry that is set up in China would otherwise have been set up in Finland. This is not the case", Markku Wallin points out.
      Emerging countries, such as China and India, offer new markets for Finnish products and Finnish know-how. However, the actual production of the goods needs to be brought as close as possible to the customers.
     
An old truth applies to production in Finland: if it is not possible to compete with low prices, it is necessary to focus on quality and know-how, which can be achieved through a high level of education.
      At present, Finland is doing well in this respect, but Mika Kautonen of the Work Research Centre of the University of Tampere warns against complacency.
      Kautonen says that there is an illusion in Finland that know-how is at a high level in all fields. "This is not the case", he emphasises.
      Kautonen notes that Western countries no longer have a monopoly on know-how; expertise is emerging in Asian countries as their economies develop.
      He also says that there is no reason to fear occasional setbacks; Finland is a small and flexible country that has made it through economic crises before.
     
The globalisation trend puts new demands of flexibility on workers. People need to be ready to relocate for jobs and to retrain for new careers. There are also calls for more flexibility over terms of employment.
      The Central Organisation of Finnish Trade Unions (SAK) nevertheless emphasises that in the new kind of labour market, the preservation of a "contract society" is more important than ever.
      Mika Kautonen warns against expectations of an emergence of a new Nokia, and says that young people should not daydream about permanently secure jobs. "The time of secure full employment is over".
      "Creating a good career requires personal initiative and sweat", Kautonen emphasises.
      ETLA’s Anthony de Carvalho sees globalisation as a bitter medicine that has to be taken. Once it is swallowed, the flexibility in working life benefits everyone.
     
But what if globalisation did not exist? "Then we would be very poor, but everyone would have a job", says Pekka Ylä-Anttila, head of research at ETLA.


Previously in HS International Edition:
  Sweets manufacturer Leaf shuts down its plant in Turku (25.5.2005)

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