Labour Market Reforms

The COVID-19 pandemic has had a smaller effect on the Finnish labour market than anticipated. At 72,7%, Finland’s employment rate has already reached the pre-pandemic level. [Please keep reading: article continues after data.]

Increasing employment to improve medium-term growth potential and sustainability of public finances is a big policy focus for the government. The government aims at increasing the employment rate to 75% during its term and is committed to measures that will improve employment by 80,000 employees by the end of the decade.

The government is seeking high employment through active measures as it seeks to prolong working careers at the beginning, middle and end. According to the government programme, raising the employment rate to 75% will require higher labour market participation of people with partial work capacity, of those with poor employment prospects, and of immigrants.

As the Finnish economy is recovering rapidly from COVID-19, reducing the mismatches in the labour market has become a priority in employment policy. Unemployment rate remains relatively high while number of unfilled vacancies is also high and growing.

The key policy measures to achieve higher labour market participation include:

  • For over 55’s: Abolishing the unemployment tunnel (an early retirement pathway). This reform will come fully into force in 2023
  • Offering jobseekers more intensive and individual support by strengthening the public employment services: the Nordic labour market service model is set to come into force in 2022. Jobseekers will be required to apply for a certain number of jobs to continue their right to receive unemployment security.
  • TE (employment) services reform by 2024, where the services will be transferred to municipalities
  • Boosting labour migration and international talent attraction (please see: Talent Boost) by at least doubling work-based immigration from current levels by 2030
  • A comprehensive social security reform by 2027 is underway. A parliamentary committee, consisting of all parties that are represented in the parliament, oversees this reform.

For more information and follow-up on the effectiveness of Government employment measures, please see the website of the Ministry for Employment and the Economy

Official Statistics of Finland (OSF): Labour force survey [e-publication].
Helsinki: Statistics Finland [referred: 10.11.2021].
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Official Statistics of Finland (OSF): Job vacancy survey [e-publication]. ISSN=1798-2278.
Helsinki: Statistics Finland [referred: 10.11.2021].
Access method: