Finland's special commitment to disadvantaged jobseekers

It's Friday morning in Alberga district in Esbo, a Helsinki suburb. Seppo Lainesalo, has come to the service centre Platstorget to surf on the employment centre home pages for vacant positions. It’s one and a half years since he lost his job as a caretaker when the firm he was working for closed down.

"l’m looking for something in the same line of business, and I sometimes come here to have a look at the websites."

Lainesalo is convinced he'll find something, but as time is passing by, he is considering adding to his labour market training by attending a course in sales. For 12 years he worked in the Soviet Union, until the end of the 1980s. He was selling equipment for air-conditioning among other things, and hopes that his knowledge of Russian and the country’s culture can be of help. He thinks the employment centre's services are good, as long as you know what to ask for and are pro-active.

"Though sometimes it feels like they're training people for unemployment. That forces people to take an education they don't want. I started a sales course with thirty people, but nine quit immediately, because they were forced to attend and had no interest in it whatsoever."

Two year old experiment

For the long-term unemployed like Seppo Lainesalo, Finland is about to create a work model where different authorities will co-operate to support the jobseekers. The model is based on a two year old experiment at the present employment centres, where social authorities and others were involved to help clients master their lives, seek jobs and help them with rehabilitation and getting back to work. The Ministry of Labour has granted funding for 15 so-called service centres and 10 additional service points. 

In all 40 employment service centres are due to be established between 2004 and 2006.

In practical terms, the responsibility will be equally divided between the Ministry of Labour and the local authorities, and 430 staff will be recruited.

At the regular employment centres the staff will concentrate on clients who are interested in the open work market.

Esko Karjalainen is assistant manager at the Public Employment Services (PES) in Esbo, and he is busy recruiting staff for one of the new service centres. Around forty new positions will be created. Esko Karjalainen is a psychologist and has worked with jobseekers since 1989. That means he has been working with employment programmes over a period when Finland went from full employment to mass unemployment - and until today's situation where around 200.000 potential employees are without jobs. 

"There is a clear demand for this service, which is more individual and long term. We support the clients even when they are already part of employment schemes. We have more staff than clients, which makes this possible. In ordinary employment centres you find 500 clients per staff."

A shortage - sooner or later

Last year, there were on average a good 70.000 long-term unemployed and 115.000 structurally unemployed in Finland. The thought behind the new model is that these people should be prepared for the open job market, in view of the fact that Finland sooner or later will be hit by a shortage of workers. The government’s aim is to create 100.000 new jobs. The employers are still not very enthusiastic.

Esko Karjalainen has many personal experiences with employers being suspicious.

"They often wonder why a person has been long term unemployed. But we also have quite good experiences, because we have found work for hundreds of our clients", he says, and underlines that it is impossible to say who will eventually end up getting a job. Seemingly hopeless cases succeed, while jobseekers with more potential remain without a job.

"Out of every thousand, five hundred get a job, but we don't know whom it will be."

No great hopes for a quick result

Unemployment in Esbo is close to seven per cent, despite being in the Helsinki region, which has long been Finland’s economic locomotive. The number of potential clients in Esbo for the new model is 4000-4500 people. Esko Karjalainen has no great hopes for quick results, and feels focus should rest on qualitative criteria, like better health or a new life situation.

"The basic aim is of course to get people into work on the open market, but people must under stand that it takes time", he says, and tells the story of an unemployed man who, when he in 1998 started on a scheme to get back to work, had a drug problem. But he got rid of it and is now in vocational education. So for him, after six years it is time to start looking for a job. What goals have you set yourselves?

"You can't have far-fetched or unrealistic goals. We succeed with some of them, but not all. We remember the positive cases. When someone gets a job, we celebrate and punch the air in triumph - sometimes we have coffee and a bit of cake."

The long term unemployed and victims of structural unemployment do not fit into a homogeneous group. There are fifty year-olds with long work experience who might have a drinking problem. Their situation can be easier than that of a 25 -30 year- old with no education and only limited work experience.

"Long-term unemployed people with higher education make up a challenging group, because they set themselves higher goals." 

Preventing marginalisation

Harri Skog: If we get 150.000 people out of unemployment, it's worth the money. ”

Harri Skog is programme director and responsible for the government's employment policy programme, which draws upon civil servants from six government ministries. The goal is to increase the level of employment and prevent marginalisation as a result of unemployment. Young people should start their education earlier and finish earlier, while older workers should be expected to stay in employment for longer. There should be improvements in health and work conditions, and the balance of work, family life and spare time should improve. The public debate surrounding the employment programme has mainly concentrated on whether the government will reach its main goal - to create 100.000 new jobs by 2007. The percentage of people in work should rise from 66,5 to 75 per cent. But since the Prime Minister, Matti Vanhanen (The Centre Party) made the promise in the summer of 2003, around 15.000 jobs have disappeared, and by early next year the government will be back to where it started. 

"It was a high goal, but if nobody sets any goals, what happens then?"

The employment programme is underpinned by the governments programme for businesses as well as lower taxes, lower employers contributions and direct employment costs. According to Skog, the employment programme is somewhat similar to the Danish model, where local authorities take care of those who aren't actively seeking work, while the state supports the active ones. Some ideas also come from Great Britain, where those on state support are really given a lot of attention. Finland has experienced a fast employment growth. During the 1989-1993 depression, almost half a million jobs disappeared. But then the economical upturn gained momentum, and 40.000 new jobs were created between 1997 and 1998. The Paavo Lipponen (Social Democrat) government more or less succeeded in fulfilling their promise of halving unemployment.

Doubtful economists

The present governments promise is based on the belief that economic growth means more jobs to more people, but that does not hold water with most economists, who doubt the government will reach its goal. Harri Skog does not think the task is impossible, but he is pessimistic.

"In industry the long-term trend seems to be that there will not be more job creation, and within the service industry the growth has declined."

Harri Skog says the important thing now is how businesses are restructured, and that there is not much more his staff can do than fulfill their part of the deal. When businesses start hiring, there should be people waiting outside the gates.

"I look after the supply now there is the question of the demand.”

The state’s share in the employment programme runs to nine million Euro. "If we get 150.000 people out of unemployment, its worth the money.”