Contribution to EIRO thematic feature on Youth and work - case of Finland

Disclaimer: This information is made available as a service to the public but has not been edited or approved by the European Foundation for the Improvement of Living and Working Conditions. The content is the responsibility of the authors.

1. Regulatory framework

• concept of youth has become more complex with the developments in Finnish society. For example, the current Youth Work Act, which regulates youth policy, relates to children and young people up to the age of29. There is no single definition of young worker in Finland, it depends on the context up to which age people are regarded as young. In employment policy (and in most statistics) young people are regarded to be those who are under25 years of age. In Finland, due to long studying times, students in universities are often older than this.

• Act on Young Workers regulates employment contracts in which the employees are less than 18 years of age. In Finland it is allowed to employ young people who are 15 years or older (or who have completed comprehensive education). In specific cases it is possible to employ 14-year-olds if this employment doesn’t harm their health or education.

• Act on Young Workers discusses and regulates working time and safety of young workers. The regular working time among young workers can be the same as for 18 years’ old and over. However, the young worker cannot work more than 9 hours a day or 48 hours a week. There are also stricter regulations about shift work and rest times applied to young workers. Employers are also obliged to make sure that the provided work is not a threat to the young person’s physical or mental development and that work load is adjusted in such a way that is reasonable for a young worker in question.

• agreements deal with general working conditions and regulate the minimum wages. These regulations concern also young workers. There are no specific inter-professional collective agreements on young workers.

2. National Programmes on Youth employment

In 2004, the unemployment rate of young men aged 15-19 was 30.4 per cent and that of young women 29.1 per cent. The unemployment rate of young men aged 20-24 was 16.5 per cent while that of young women 14.6 per cent. The general unemployment rate of men was 8.7 and that of women 8.9. One of the reasons behind high youth unemployment in Finland is that a large proportion of full-time students participate in the labour force. In 2002, as many as 58 per cent of university students were working and even 21 per cent of high school pupils were working in the labour market.

The social guarantee for the young introduced in 2005 by the Finnish government is closely related to the aim of preventing marginalisation of young people. All young people who are out of work will be offered an education, training or workshop place no later than after three months of unemployment. This is a much more ambitious target than the previously used EU-level target that every young unemployed person should be offered a new start before six months of unemployment. Furthermore, the Ministry of Labour’s aim is to make sure that 90 per cent of young unemployed people have a tailored job-seeking plan before they have been three months out of work.

The early intervention among the young unemployed job seekers is well in balance with the fact that the long-term unemployment is much more rare among young job seekers than among older age groups. In 2004, the average duration of completed unemployment spells was six weeks in the age group 15-19 and nine weeks in the age group 20-24, while the overall average was 16 weeks. In 2004, the long-term unemployment was practically zero among 15-19- year-olds and only 4 per cent among 20-24- year-olds (the average being 25 per cent). However, the risk of having a repeated unemployment spell is twice as high among young job seekers compared with others.

In 1994, a means tested labour market support was introduced covering unemployed job seekers who had not fulfilled the time-at-work condition before becoming unemployed, which was required to be eligible for earnings related and basic unemployment allowance. Most of the young labour market entrants, who are searching for a job for the first time, are covered by the new labour market support. In 1996 and 1997 legislative changes were introduced that put strict eligibility conditions on the labour market support for the young unemployed job seekers. Basically these changes meant that if young job seekers refused to participate in the labour market programmes, they had a risk of loosing their labour market support for relatively long periods.

Under the labour market support scheme it became possible to fund individual’s practical training by an amount equalling the labour market support. For the young unemployed, placement in practical training (youth practical training) has largely displaced other forms of active programmes. This is especially evident among unemployed persons under 20 years of age. At the end of 1990s around three fourths of all active measures targeted at this age group were organised through youth practical training, which is a relatively inexpensive way to organise active measures.

In addition to the labour market measures of which main target group is unemployed job seekers, several initiatives to improve the position of young people on the Finnish labour market have been introduced. The Youth Participation Project was launched in 2003 and consists of 39 municipal or regional projects involving in total 72 municipalities. The Finnish National Board of Education (Opetushallitus) is co-ordinating the projects together with Finnish Youth Co-operation Allianssi. The objective of the project is to promote youth participation and placement in education, society and working life. The project receives both government and municipal funding.

The Youth Workshop Activity aims at supporting a young persons’ social growth and reinforcing their skills in life, preventing exclusion, and guiding a young person to education and the labour market. The young most often work at the workshops for six months. A young person can also be in practical training or apprenticeship training at a workshop. In 2004, there were 220 workshops in which 7,000 young people were working.

Of the workshop young, 52 per cent lack vocational education and of them about 2.5 per cent do not have a comprehensive school leaving certificate. In 2004, about half of the workshop participants got a place in education or working life after the workshop period. The young felt that this period had helped them manage their lives better, increase their educational and working life skills, as well as clarify their future goals.

3. Role and views of the social partners on Youth at work

In Finland, when regulatory framework for employment or social policies are to be changed, suggestions for changes are normally based on a tripartite cooperation and negotiations. Due to this practice, social partners have a natural and important role in youth employment policy shaping.

In addition to their general role in policy shaping, social partners have their own youth programmes. The aim of these programmes is mainly to distribute information about the respective sectors and to facilitate future recruitment. For example, Technology Industries of Finland (Teknologiateollisuus) has an ongoing campaign aimed at school children at their final years of which aim is to make technology industries a more attractive as a working place.

The Economic Information Office (Taloudellinen Tiedotustoimisto, TAT) works for Finnish industry and commerce. TAT coordinates a three-year youth programme of Finnish industry for 2004-6. It is responsible for informing schools about matters that are important to industry, and it supports cooperation between schools and companies.

Confederation of Finnish Industries (Elinkeinoelämän keskusliitto, EK) and its affiliates emphasise the importance of the cooperation of their member firms and educational institutions. In 2003, about 46 per cent of EK member firms had visits from educational institutions, 36 per cent accepted young people for introductory workplace visits, 30 per cent had visits from teachers, 28 per cent had trainees or those who were working on a study report, and 5 per cent had teacher-trainees.

Commission for Local Authority Employers (Kunnallinen työmarkkinalaitos, KT) and State Employers’ Office (Valtion työmarkkinalaitos, VTML) both have recognised the need for youth policies to make opportunities to work in public sector more known to young people. Both in municipalities and the state the workforce is ageing rapidly.

In 2000, the state started to a project of which aim was to advertise state as an employer to young people. The results appear slowly but seemed positive. The state attends exhibitions, publishes materials such as booklets and videos, and gives lectures to make state more know to young recruits. Some sectors have their own youth recruitment policies. For example, National Police School (Poliisiopisto) has a recruiting strategy together with the corresponding trade unions. University students are offered traineeships in state organisations.

The local authority employers regards that forecasts for future recruitment needs should be coordinated better in Finland. In 2002, a project called Local jobs 2010 (Kuntatyö 2010) was initiated with the aim to improve the quality of municipal working life and defer the time when people retire at the same time as making municipalities a more attractive workplace for young people. The Local jobs 2010 project is carried out from 1 May 2002 to 31 December 2006 by both the Local Government Pensions Institution's (Kuntien eläkevakuutus) research activities and the Healthy Work - Healthy Municipalities (Kuntatyö kunnossa - Tie hyvinvointiin) programme. Among other things, the project has given 50 seminars for young university and vocational school students about working in municipalities. It has several publications and a web-site, which has had until now about 85,000 visitors.

The central trade union organisations with their member firms also have their own youth policies. Most trade unions accept and actively recruit student members. Among trade unions affiliated to the Central Organisation of Finnish Trade Unions (Suomen Ammattiliittojen Keskusjärjestö, SAK) one quarter of union members are under 30 years of age. SAK has published its own youth policy document and is active in youth policy issues together with its member unions.

The other main central trade union organisations; the Finnish Confederation of Salaried Employees (Toimihenkilökeskusjärjestö, STTK) and the Confederation of Unions for Academic Professionals in Finland (Akateemisten Toimihenkilöiden Keskusjärjestö, AKAVA) are also active in youth policy. AKAVA has 91,000 student members. It is the second largest organisation in Finland which takes active part in student policy issues.

4. Discussions and research

A recent study, which explored the long-run effects of active labour market programmes among young unemployed job seekers (between 16-30 years of age) during 1995-2000, suggests that job placements and labour market training improve young persons’ labour market prospects and are in this sense effective labour market programmes. A rather discomforting result of this study, however, is that youth practical training, which is the most common active measure among the young job seekers, does not seem to improve participants’ employment prospects. Youth practical training is the least expensive of active programmes offered to young unemployed persons but it seems to be also the least effective.

Another recent study on the labour market support gives rather disappointing results of the impact of the legislative changes after mid 1990s, which put strict eligibility conditions on the labour market support for the young unemployed job seekers. These changes meant that if young job seekers refused to participate in the labour market programmes, they had a risk of loosing their labour market support for relatively long periods. It appears that the share of young people on labour market support did decline after these legislative changes. However, there was not a corresponding increase in employment, rather these changes lead to young job seekers’ withdrawal from the labour market.

5. Commentary

At the face of diminishing population, youth employment policies are in high regard in Finland. It is well recognised that the biggest problems in youth employment are the difficulty of finding the first job, short-term employment, and for some young people, the lack of training and/or motivation for training.

The government has taken actions to speed up the transition from school to work. Financial incentives have been designed so that young unemployed job seekers find it hard not to accept jobs that are offered to them. Youth workshops are provided for young people who drop out from the school system and cannot find a regular job. Recent studies suggest that employment policy measures targeted at youth have been quite ineffective. Much need to be done to make Finnish labour markets more attractive to young people. (Reija Lilja, Labour Institute for Economic Research)