This week in our blog we discuss a new report by the Ministry of Economic Affairs and Employment. It tells us what kind of employers create new jobs in Finland.
If you are a job seeker in Finland it pays to know what kind of companies create new jobs. This knowledge allows you to focus your job search on those companies that are more likely to open positions for recruitment also in the future.
Heikki Räsänen and Minna Ylikännö’s report is based on data from 2021. Their analysis shows, however, that the characteristics of employment engines in Finland are relatively constant. Hence their conclusions about the 2021 data can be used to predict the future.
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What is a new job?
As we have discussed before based on an earlier report of this kind, companies look for new employees for three main reasons.
They need to replace someone who has moved onward to work at another position. This new position might be within the company or they might have switched companies.
Another reason is that the person has left the workforce entirely. They may have retired, moved to another country, gone on extended family leave, or started studying full-time. Whatever the reason, the person is no longer part of the Finnish labor force.
When jobs open up for these reasons, the government doesn’t consider these ‘new jobs’ since they do not add to the number of people the company employs. As an extension, they do not add to the general employment rate in the country. The employer is merely replacing an employee with a new one. These two types just differ in the reason for the replacement.
New jobs, instead, are positions that add to the personnel figures of the employer. There are two different types of new jobs.
One is that the employer needs additional people to do existing jobs. Like a factory adding a new production line to respond to an increase in demand. The new production line has the same kinds of jobs as the previous production lines. So, there are more people doing the same stuff as before.
Another type is when a company decides it needs to create a completely new position altogether. Get someone to do something that hasn’t been done before in that company. In both of these cases, the employer has more employees than before. There’s growth.
The report we discuss here examines what kind of businesses created new jobs in Finland in 2021.
Recruitment in Finland in 2021
Last year, 58 224 employer locations (an employer can have several offices or locations) opened searches for new employees for permanent employment relationships. These locations or offices had 201 000 open positions.
Another 51 722 locations opened searches for 352 000 fixed-term employees. Some locations or offices had both permanent and temporary positions open.
Of all of the 553 000 open positions, 52 148 (9.4 %) were not positions requiring Finnish or Swedish.
All in all, about 54 % of all Finnish offices/locations had positions open in 2021.
Compared with 2020, there were more open positions and they were more often permanent positions.
20 % offices/locations recruited both permanent and fixed-term employees. 15 % were only looking for fixed-term employees and 19 % were only looking for permanent employees. In Finland, employment relationships are by default permanent unless. There must be a specific and acceptable reason for the position to be fixed-term.
In 2021, a common reason for offices/locations (23.3 %) to recruit was because the employee had left for another employer. 16.5 % of recruiting offices/locations explained their recruitment need with substitution. 6.7 % gave retirement(s) as a reason. A small portion of the offices/locations (3.3 %) needed to find someone new because the previous person had switched jobs within the company.
The most common recruitment need (36 % of recruiting offices/locations), however, was for additional employees. 7.5 % explained their recruitment need with having a completely new job to fill. So, about 44 % of offices/locations explained their recruitment need with new jobs, with job creation.
Employers creating new jobs in Finland in 2021
Job creation as a reason for opening a search for new employees is more common in the private sector. There, job creation was a reason in over 50 % of the time. In the majority of these cases, companies needed extra pairs of hands to do existing tasks. They did not need employees for completely new tasks.
If we factor in such things as the size of the office/location or the industry, we learn more about what kind of employers create new jobs in Finland.
In larger offices and locations, recruitment was more often due to retirements.
In larger units, it was also more common for employees to move around within the unit or company. This creates a vacancy that needs to be filled.
Larger units or employers are, however, also more likely to create completely new positions. Smaller offices/locations instead are more likely to hire new employees to do existing jobs.
Industries, where the majority of open positions are new jobs, include:
- construction (ca. 80 %);
- agriculture, forestry, and fisheries (ca. 70 %);
- information and communication (ca. 66 %);
- professional, scientific and technical activities (ca. 63 %);
- mining and quarrying (62 %);
- administrative and support service activities (ca 50 %);
- accommodation and food services activities (ca. 50 %); and
- transportation and storage (ca 50 %).
Businesses creating new jobs in Finland in 2021
Based on their analysis, Heikki Räsänen and Minna Ylikännö conclude that employers that have the following characteristics are more likely to create new jobs:
- their employee numbers fluctuate over 10 %;
- they show a growing trend in their personnel numbers;
- they have more than 50 employees;
- they have international employees;
- they’ve hired a student;
- they’ve recruited someone who had been unemployed;
- they’ve hired two or more people for permanent positions;
- they’ve offered full-time contracts.
Some of these criteria only apply in certain economic situations. Some are more constant features of job creators.
They also examined whether there are differences in the characteristics of companies that create completely new positions versus those that need extra hands. According to them, having international employees is a stronger indicator for completely new positions. So is offering full-time contracts.
So, when you are devising your job search strategy, look for companies that have these characteristics. It suggests that they are likely to hire new employees also in the future. Furthermore, already having international employees suggest that they might need people to do jobs they don’t yet have.
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