Finland’s economy is entering the year on an uneasy footing. Consumer confidence has weakened, and unemployment is moving higher, according to official data.
“Consumer confidence and labor market figures paint a cautious economic picture for the start of the year," Elias Erämaja, chief economist at Suomen Ekonomit, said in a statement today. "Chronically weak confidence is eating away at the drivers of growth as the year begins.”
According to Statistics Finland, consumer confidence slipped again in January, with fears of unemployment reaching their highest level since the Covid-19 year of 2020.
Labor market data add nuance rather than reassurance. Unemployment rose in December, pushing the trend unemployment rate for those aged 15 to 74 to 10.7 percent. Employment, however, has remained relatively resilient. The total number of employed people was only slightly lower than a year earlier. Employment among men was broadly unchanged, while the number of employed women fell by around 7,000 compared with last December.
That resilience could matter if conditions improve. “The latest unemployment figures look ugly, but employment has held up surprisingly well. An increase in labor supply creates good conditions for growth once economic uncertainty eases,” Erämaja from the trade union said.
What would shift the mood? “A recovery in confidence would give the economy much-needed momentum, but at least in the coming months, the growth outlook remains sluggish,” he predicted.
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