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Ministry: Finland's long-term unemployment will surge

The Ministry of Economic Affairs and Employment (TEM) projects more long-tern joblessness in the country.

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Long-term unemployed refers to people seeking employment for at least a year. Image: Tiina Jutila / Yle

The coronavirus pandemic will continue to affect jobs in 2022, according to the latest labour market forecast from the Ministry of Economic Affairs and Employment, MEAE.

"The coronavirus crisis has completely changed the picture of the labour market. Above all, it has been a service sector crisis," said MEAE official Johanna Alatalo.

In the forecast the ministry projected that the unemployment rate will rise to 8.2 percent next year, dropping to 7.8 percent in 2022. Officials also said the level of temporary layoffs would remain high at least through next summer.

The ministry said that while Finland’s labour market will start rebounding at the end of 2021, recovery would be faint while there was a risk the pandemic's negative impacts on the labour market would linger.

"Things could be worse"

The ministry, however, said figures suggested the labour market had not suffered too badly during the pandemic overall. Officials said this was likely due to factors such as moderate restrictions to curb the spread of the virus and companies using temporary rather than permanent layoffs to weather the crisis.

"Rescue support has also played a big role--without it the situation would definitely be worse," Alatalo said.

The ministry said it believed the pandemic would accelerate the growth of long-term unemployment in the coming years, as jobless periods would stretch over longer periods of time and as people who lost their jobs in the spring transition into long-term unemployment, which the government defines as being out of work for more than 12 months.

The ministry projected that there would be 75,000 long-term unemployed persons in Finland this year -- 11,000 more than last year. That figure is expected to rise to 107,000 in 2021 and to continue growing to reach 113,00 in 2022.

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