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Finland's next government will face a slowing labor market just as the need to get more people working becomes more pressing, the Economy Ministry warned.
The rate of employment growth is predicted to halve this year to 35,000 new jobs compared with the 67,000 jobs created in 2018, and halve again in 2020, the ministry said in a report on Tuesday in which it blamed mismatches in the labor market, structural unemployment and the impact of an aging population.
The report is unwelcome news for Social Democrat leader Antti Rinne, who is heading coalition talks with four other parties. His government will need to secure significant employment gains if Rinne wants to honor the promises made during last month's election campaign.
Safeguarding the future of the country's generous welfare state requires increasing the employment level to 75% of the labor force over the next four years, the ministry said in February. The rate rose to 71.7% in 2018, and is forecast at 73.4% in 2020.
Read more on Finland's urgent need to create jobs
To contact the reporter on this story: Kati Pohjanpalo in Helsinki at kpohjanpalo@bloomberg.net
To contact the editors responsible for this story: Tasneem Hanfi Brögger at tbrogger@bloomberg.net, Nick Rigillo
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