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Pensions agency welcome record levels of work-based immigration

Finland's net immigration reached a record high of almost 35,000 last year.

A cleaner vaccuming a hotel lobby.
More than 20,000 of the people who immigrated to Finland last year, already had a job upon arrival. Image: Henrietta Hassinen / Yle
Yle News

Finland saw net immigration reach a record-high level last year, according to Statistics Finland, with 34,363 more people immigrating to the country than emigrating from it.

The figure excludes people who moved to Finland from Ukraine under temporary protection due to the war.

The population gain was a pleasant surprise for pension funds, according to Suvi-Anne Siimes, head of pension provider interest group Tela.

"It's good news for occupational pension funds and certainly for society as a whole. If last year's trend continues, it would be enough to make up for the decline in the number of working-age people we are seeing as a result of lower birth rates and retirement," she said.

Moreover, a record number of immigrants, some 20,000, already had a job waiting for them in the country upon arrival. Some 4,000 of those who moved to Finland for work came from the EU, while some 16,000 arrived with a work permit from outside the bloc.

Most of them arrived to work in blue-collar jobs, according to Statistics Finland, who added that the group also included specialists, researchers, seasonal workers and start-up entrepreneurs

Some 14,000 other people moved to Finland for studies or family reasons.

"It seems that the labour-shortage-inspired efforts of companies are now bearing fruit, which is a really good thing for the economy, public funding and, in the long term, the pension system," Siimes said.

The pension boss adds that she hopes the Ministry of Economic Affairs and Employment will continue to boost its efforts in attracting workers from abroad, as it has successfully done in India, for example.

"From a longer-term perspective, it is really important to be on the ground to tell people and get them interested. Nobody else will do it for us. We have already had a lot of people from Asia, for example, come to us on the social services side. The business community has probably been hoping for this for many years, so it's really positive that things are moving forward."

Last week's All Points North looked at government formation talks and the next government's likely harder line on immigration. Listen here, on Yle Areena or via Spotify.

More immigrants, lower pension contributions

Pension contributions in Finland are based on the wages paid to employees. Employers cover some 17 percent and employees around 8 percent.

Statistics Finland predicts that net immigration will average some 15,000 per year in the coming years. Immigration at that level would require an increase in pension contributions to maintain the current system.

If net immigration averages some 35,000 per year, however, the share workers and employers pay towards pension contributions could drop significantly, according to Finnish Centre for Pensions (ETK) forecast expert Heikki Tikanmäki.

"Currently, there is a need for an increase of about one percentage point in pension contributions in private sector pensions. If immigration stays as high as it was last year, it would mean that the need for the increase would be offset and in fact, the same amount would suffice to lower the contribution level in a sustainable way," Tikanmäki said.

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