More jobs than expected disappearing from domestic industry

The Finnish unemployment rate may begin to rise in the near future, as the industrial sector has begun to dismiss more employees than it previously estimated. Department head Pekka Tsupari from the Confederation of Finnish Industry and Employers (TT) believes that 20,000 jobs may be cut from Finnish industry in 2003. The wholesale and retail sector has also recently warned that some dismissals may be in store later on in the year. Jarmo Kontulainen from the economics department of the Bank of Finland and researcher Anthony de Carvalho from the Research Institute of the Finnish Economy expect the unemployment rate to rise from around nine to 9.3-9.5 percent in the near future. The economic climate has been quite weak in Finland for the past two years, but the good financial standing of companies has allowed them to refrain from layoffs. As a recovery has been delayed, the pressure to begin cutting jobs is now mounting. Also, the need to lay off larger numbers is growing at the same time. According to Tsupari, the employment situation on the industrial side remained quite good until the autumn. By October the number of industrial employees had begun to decline, and if the same rate of dismissals continues, some 20,000 jobs will be lost by next autumn. In a previous forecast, TT estimated that 12,000-13,000 jobs would be lost in 2003. The industry's current worries include the weak economic outlook in Germany, which is an important target of Finnish exports. Consumption in the UK is also beginning to fall, which could further affect Finnish exports.