Is this about the minimum wage or the minimun wage in service sector TES (työehtosopimus)? There’s not much the government can do to affect TES is there?

There is no such thing as a “minimum wage” in Finland. All the wages and payscales are mandated by the TES, I am trying to be creative and invent a job not having a TES, but can’t. And the minimum wage in TES is supposed to have a salary a person can live on. So the OECD does something about the rents and food and other prices and then starts to complain about the salaries. Besides which it is not the salary the employee gets that is too high, it is the “hidden costs” as in the employers social security & other fees that make the employee cost them 3000, the employee sees 1500 gross on the payslip and gets 1000 into the bank… *that* is what the problem is. OECD can tehmselves try to live in Helsinki with that kind of money and then complain about too high salaries. Dickheads.

Hi Phil,

How’s life there in 2003? Here in 2006 the unemployment figures do not look as bad as that. E.g. Sweden 6.1% vs. Finland 7.6% (June 2006 figures).

http://www.bof.fi/eng/5_tilastot/5.1_Tilastografiikkaa/inetkaavio.asp?kuvaid=824&kieli=ev&topicid=5.1.8_reaalitalous
http://www.scb.se/templates/tableOrChart____23343.asp

How’s life there in 2003?

The data used above was produced in 2006 by the OECD along with Statistics Finland, and was about 2005′s statistics.

There is no such thing as a “minimum wage” in Finland. All the wages and payscales are mandated by the TES, I am trying to be creative and invent a job not having a TES, but can’t.

That’s the same thing as a minimum wage, the government just outsourced the law. Can I legally pay someone 2e/hour? If not, there’s a minimum wage.

One thing that drives me crazy is that, along the southern coast, we probably have a couple million people; yet we don’t have one single 24-hr supermarket, all R-Kioski-type stores close at 21:00 or 22:00 and those little food wagons near the train station occasionally go un-manned for entire weekends. In fact, they close for months-at-a-time and it’s not just during cold weather. I mean, these are supposed to be 24-hour money-making machines.

I don’t know who’s at fault, but there’s definitely something wrong. These are perfect ‘youth jobs’, but why aren’t they being filled?

I don’t know who’s at fault, but there’s definitely something wrong. These are perfect ‘youth jobs’, but why aren’t they being filled?

Because youth are supposed to be out drinking and partying, not earning income to support themselves. It amazes me as well, we have stores that want their doors open, employees who wish to work, and consumers who wish to shop – yet some wealthy politician stands between all three and says NO.

“The data used above was produced in 2006 by the OECD along with Statistics Finland, and was about 2005’s statistics.”

Ummm nope, Table 21 in the report Unemployment rate is from “2003″ and Avarage Annual is from between “1993-2003″.

Looking at:
http://www.bof.fi/eng/5_tilastot/5.1_Tilastografiikkaa/inetkaavio.asp?kuvaid=824&kieli=ev&topicid=5.1.8_reaalitalous
Supports also that they are using 2003 figures.

Hank W., I don’t understand your calculations. Let’s denote the personnel costs of our company by X. I can see from our accounting that the net salaries are about 0.52-0.53*X. If the salaries are lower than here (employee gross ~50000€/year), the net salaries are higher. Of course, each employee needs proper tools and space, but these are not personnel costs.

What really matters is the employer’s capability to sell the employees’ output.

Well I guess I’m glad they’re looking at averages over a few years, rather than one point in time, if they just took one summer month for instance, it might say we have double digit unemployment.

One thing that drives me crazy is that, along the southern coast, we probably have a couple million people; yet we don’t have one single 24-hr supermarket

Huh? There are dozens of them, if not hundreds, depending on what qualifies as a “supermarket”. For example the “S-markets” of ABC stations must do by any standard. I’ve got two 24-hr supermarkets within a walking distance (but of course that’s not the case with most people, many need a car if they all of a sudden realise in the middle of the night that they’ve run out of something).

Well, quoting average annual as 12.2% and forgotting to mention that it is an avarage of ten years between 1993-2003 is not really fair. Mid nineties was really bad and that definitely shows in that avarage.

Looking at the recent three years things are a lot better than you imply. They could be better, but things have improved here faster than elsewhere and the gap isn’t necessarily anymore two/three times.

Finland’s unemployment has gone steadily down for years and it’s below 8% nowadays. Soon the figure apparently will reach the 80s level – those golden days when the welfare state was still functioning as it should.

The youth unemployment is well below 5% in Helsinki but there are areas where it’s close to 50. We all thank the Centre party for its wise regional politics for that, transferring “southern” tax money to those areas where the wolves howl in the night and you’re afraid of letting your kids walk to the school by themselves. But whatever they do, it’s not working. People are moving to the south in bigger numbers than ever.

Weak Phil, most of the data is totally oudated. (read 2003)

Weak Phil, most of the data is totally oudated. (read 2003)

Blame the OECD. I trust they’d have the latest data. Maybe detailed stats from 2003 onwards aren’t available? You’d think they would have been able to find them, they are the OECD afterall.

So tell me – what’s the current youth unemployment rate in Finland?

So tell me – what’s the current youth unemployment rate in Finland?

It’s somewhat below 20%. The figures are updated monthly or bi-monthly, I think. These statistics are controversial, though. Some think they are too low, some that they are too high. Because of unemployment benefits many young people pretend to be unemployed although they are in fact just prepearing for exams and such stuff, for example.

Phil,

You can blame OECD, but you should also improve your reading comprehension… 2003 and 1993-2003 is pretty visible in the report .

“So tell me – what’s the current youth unemployment rate in Finland?”
Never tried to type Youth Unemployment Rate in Google and press “I’m Feeling Lucky”?
http://www.stat.fi/tup/suoluk/suoluk_tyoelama_en.html

So yout unemployment was 20.1% in 2005, still pretty high.

BTW. You can also see from the above page that the unemployment rate, in general, has gone down from 14.4% in 1993 to 8.4 in 2005. Looking at the avarage from beginning of this year it was about ~7.9.

It is not possible to make a cogent argument that Finland has a structural unemployment problem. As Anonymous wisely pointed out, Finland’s unemployment situation has improved steadily since it skyrocketed after the collapse of the USSR. To come down from 20% to what it is now (about 8%) is no mean feat and the expectation is that it will continue to fall to about 7.5% next year. That’s only 1% higher than the US rate only a couple of years ago – the US where you have practically no unemployment protection and a shockingly low minimum wage.

If someone works a decent 37.5 hr week they should be able to live on it and move their life forward. The fact that in the US you can work hard and barely scrape by is inexcusable.

You can blame OECD, but you should also improve your reading comprehension… 2003 and 1993-2003 is pretty visible in the report

Shame on OECD for releasing a report a few months ago on data that’s 3+ years old. And hat tip to you all for researching deeper than the OECD! Leave it to the blogosphere for the in-depth reporting.

68% employment rate in Finland. I’d love to see the break-down of what the other 32% are doing. And I’d love to see how many of those 68% fall under that “precarious” category and don’t work full time, or are temps, or don’t have permanent contracts. Living each day wondering if you’ll have work the next – you can’t plan a life that way, can take a mortgage, can’t take any big loans. That pressure on people each day must really fuck with their heads.

the US where you have practically no unemployment protection

That may be true, but what’s stopping my company from laying me off tomorrow? In my current job, I can’t see ANY difference in unemployment protection compared to my last job in the states.

I don’t know who’s at fault, but there’s definitely something wrong. These are perfect ‘youth jobs’, but why aren’t they being filled?

I don’t doubt that there would be people ready to work those hours. However there is such thing as “iltalisä” and “yölisä” so someone working past 22 on a saturday night is raking up 300% overtime salary.
And the fact tha bigger shops have their opening hours restricted… Not that they woulldn’t want to open on a Sunday at 8am, they just may not…

Those statishtics can be a bit dodgy. Some EU survey classified everyone in the army as “unemployed”.

68% employment rate in Finland.

It pretty high, higher than in most OECD countries, quite a lot higher than in the USA.

Here’s a an OECD table (Excel) comparing Finland to other OECD countries. Child poverty is about the lowest, relative poverty among the lowest. But what about subjective well-being or social isolation?

http://www.oecd.org/dataoecd/35/6/34555570.xls

“I don’t doubt that there would be people ready to work those hours”

Huhhh? The midnight shift is perfect for young people! They can sleep late and work late. Then on free nights, they can consume copious amounts of ecstasy and party ’till the sun… well, nevermind the sun, since we’re in Finland after all… until very early morning hours–say 6am.

And after a long night of partying, they’ll still get to bed according to their regular schedule. I’ve lived by these hours all of my life (I don’t do ecstasy though). There’s nothing undesirable about it

I see your point about the unions though. It figures they’d constrict the economy in such a way. Instead of shoveling tourist money into their pockets, businesses are forced to close early and forgo the extra profit…and the state forgoes the additional revenue of course. So, to make-up the difference, we have to pay 7-euros for the otherwise cheapest food in Europe: The ubiquitous Kebab. Wonderful.

Oh, sorry Henk. I thought you meant that nobody would work those hours. My eyes must be tired Oh well, same point otherwise though.

“In addition, the OECD says the difference between low and high wages is too small, which stifles ambition.

The organisation says that high starting salaries, especially in the service and hospitality sectors, work as employment barriers against young people.”

Sure, if right out of the gate you are already making almost as much as those around you.

One thing that really gets me is that it matters not if you (and the employer) are in the union, everyone is still bound by the union agreements.

Here is the latest comparison of unemployment figures between USA and Finland.

USA: July 2006

“Total nonfarm payroll employment increased by 113,000 in July, and the unemployment rate rose to 4.8 percent…Both total employment (144.3 million) and the employment-population ratio (63.0 percent) were essentially unchanged in July. The labor force participation rate held at 66.2 percent. (See table A-1.)”

Finland: June 2006

“In June, the employment rate, that is, the proportion of the employed among persons aged 15 to 64, stood at 72.1 per cent, which is 0.6 percentage points higher than twelve months earlier. Adjusted for seasonal variation, the employment rate went up to 68.5 per cent. Labour force participation rate: 70.3!!! Unemployment rate: 8.1 %”

Still, US statistics try to spin the numbers: Unemployment rate sure as hell is NOT 4.8 percent when you compare the labor force participation rates. In the US you are only counted as unemployed if you haven’t actively seek work in last four weeks and not worked ONE single hour during that period.

Sources:
http://www.bls.gov/news.release/empsit.nr0.htm
http://www.stat.fi/ajk/tiedotteet/v2006/tiedote_047_2006-07-25_en.html

@Kristian,
how many people do you think will actually come shopping in the middle of the night? A 24-hour money making scheme needs customers, too.

@POD

I’m not suggesting that ALL stores remain open 24-hrs. However, the R-Kioskit, along with some restaurants and perhaps many other businesses, could benefit from extended–and even nighttime–hours. The streets are filled with people until 3am on weekend nights. Lots of them are tourists who are probably wondering where to spend money on food after a night of disco.

Instead, we offer them this concept of ‘Lounas Ravintola’ which means Lunchtime Restaurant. Seems like almost every resterant just stays open for a few hours in the middle of the day, then close late afternoon or early evening. No thanks, I’ll go somewhere else.

For that matter, at least one- or two- grocery stores could stay open. After all, there’re nearly 1-milion people in the Helsinki region. They could re-stock the shelves at night (which some probably do anyway) and keep the doors and a cash register open. It’s probably even more efficient to run things that way.

Anyway, it seems like the inflexibility is to blame in Finland–perhaps more to blame than the high wages. Thanks to the unions, we all have to pay with higher prices, lower consumption and a boring lifestyle.

There are dozens of markets that are open 24 hours in the Helsinki area. Not in the city centre, though, as far as I can recall.

The K-Market in Kamppi should be open ’till 1-am, as far as I’m concerned. For that matter, the fast food restaurants on the ground floor of Kamppi should remain open until that time.

For those who don’t know, Kamppi Center is the new main bus station and shopping mall. The ground floor is where we wait for our busses to Espoo. In my opinion, it’s planned wrong: The ground floor level should be a fast food mecca–all types, like mexican, eastern Med,
Chinese, etc. Instead we have a book store, arts and crafts, computers, cosmetics…yawn.

And to make matters worse, those two- or three- fast food joints close at about 21:00…despite that Kamppi is PACKED with people until 1-am.

Oh well, good thing we have high taxes to pay for all that lost revenue.

“Still, US statistics try to spin the numbers: Unemployment rate sure as hell is NOT 4.8 percent when you compare the labor force participation rates. In the US you are only counted as unemployed if you haven’t actively seek work in last four weeks and not worked ONE single hour during that period.”

Tim,
And Finland does not spin unemployment numbers? What a joke. They force unemployed to go work for their unemployment at unpaid positions and all of a sudden they are not unemployed. They limit the number of hourse people can work to force companies to take on additional staff. They restrict the ability of students (who are not considered unemployed) to work (loss of opintotukki) to force employers to hire from the unemployed. Students also spend more time in school in Finland than the US, putting the in the workforce later. Finland also has welfare and they are not counted either.

As for the labor force participation rates, that has nothing to do unless you can tell what percentage of the population that is not employed and not unemployed is actually looking for work? A higher participation rate and higher unemployment rate in Finland simply means that more people either want or need to get a job. (or just want to collect unemployment!)

My wife is part of the non-participating. However, she is not looking for work. Nor are lots of other stay-at-home mothers. It is discounts those who retire early. Where do you think the higher percentage of early retired are? How many Finns retire early to the US?

“Total nonfarm payroll employment increased by 113,000 in July, and the unemployment rate rose to 4.8 percent…Both total employment (144.3 million) and the employment-population ratio (63.0 percent) were essentially unchanged in July. The labor force participation rate held at 66.2 percent. (See table A-1.)”

Imagine that. Total number of jobs increases as did the number of unemployed. That shows that the economy is getting better because people who ere not working are now looking for work.

Well yes, but then you have the problem of staffing & security. many of those late-nite places are having trouble already at 22. There used to be some kind of ban from women working nights alone at some point and time…

“Imagine that. Total number of jobs increases as did the number of unemployed. That shows that the economy is getting better because people who ere not working are now looking for work”

In which world do you live? US economy needs at least 150 000 jobs to keep up with population growth. That has not happened for months now. House sales are dropping like stone, US consumer savings rate is now MINUS 1,5 percent etc etc. Economy is stalling badly and I’d expect things will be very shitty by early next year. Housing boom is over and there is no other economic bubble forming anywhere to save the day.

“If someone works a decent 37.5 hr week they should be able to live on it and move their life forward. The fact that in the US you can work hard and barely scrape by is inexcusable.”

This describes all my friends in Finland w/o University degrees in their mid to late twenties. The only ones getting ahead are working more than 37.5

Don’t kid yourself

describes all my friends in Finland w/o University degrees in their mid to late twenties. The only ones getting ahead are working more than 37.5

I wonder what field you and your friends are in. More than half of the people I know work like 37.5 hrs a week.

“fact that in the US you can work hard and barely scrape by is inexcusable.”

Darn, with 5 cars, 2 boats, just one wife, this life must really suck here in America. I even added a Finish Style Sauna to my place last year and I barely scrape by. I plan to retire in 7 years with no morgage on anything I own. Just having to scrape on by in retirement with 80% of my current income, could be a tough life.

(Well unless I get another car, can you say Hummer????)

But the unions are protecting Finland, don’t you believe what they say. Heavens!

Mind you, it doens’t stop them paying themselves very large salaries.

Union people complain and lefties complain about outsourcing to Estonia / cheaper lands.

So where did last year the Leftist party and many unions take their meetings… why Estonia.. Where did many lefty union members go on holiday … why Estonia and Thailand (why not Finland, spending their money in Good Finnish companies paying for their fellow union members to serve them in a good Finnish style.

Because it is too fucking expensive, too restrictive maybe…=

Hypocrits.

Winter, the devoted worshipper of Temple of Mammon. Gosh, those Indians must really feel proud of you guys, your ancestors first taking their land by force and now your kinds gradually turning America to a giant plastic set of malls and nothing but highways and parking places in-between.

Respecting nature and restraining from overexcessive consumption are both so outdated! Man is meant to drive to everywhere, walking even to nearest restaurant or shop is so loser thing. You are nothing unless you own at least three cars, 15 guns and one boat.

15 guns? The gun closet is not that big.