News commentary: Finland’s economy is growing rapidly – employment is still lagging

Based on data for January to June, Finland’s economy has been among the fastest-growing in the EU. If the pace seen during the first half of the year continues, GDP growth of up to three per cent may be possible this year.

Strong economic growth has not yet translated into new jobs. According to Juhana Brotherus, CEO of Finnish Work, employment usually responds to economic growth with a delay. This time, the delay may be longer than usual.

– Companies typically begin by increasing the working hours of their existing employees and raising production. New recruitment starts only gradually, once confidence that demand will continue has strengthened,” Brotherus says.

The employment figures for July already showed the first signs of improvement. The number of employed persons was unchanged from one year earlier, while the number of unemployed persons was 20,000 higher. The rise in unemployment was not caused by a loss of jobs, but by an increase in labour supply: the labour force grew by 19,000 people, while the inactive population decreased by 18,000.

According to Statistics Finland, the trend of the unemployment rate among people aged 15 to 74 was 10.5 per cent in July. The trend of the employment rate among people aged 20 to 64 was 75.4 per cent.

Why is employment responding slowly?

Brotherus identifies two factors that may be slowing the transmission of economic growth to the labour market. The first is companies’ higher threshold for hiring. The prolonged economic downturn and the exceptional series of disruptions caused by the COVID-19 pandemic, Russia’s war of aggression and uncertainty over trade policy may have made companies more cautious.

– Companies may now need fuller order books before they feel confident enough to start recruiting,” Brotherus estimates.

The second factor is the rapid development of artificial intelligence. Before hiring a new employee, companies must assess more carefully what kinds of tasks people will perform in two or three years and what skills will then be required. According to Brotherus, this uncertainty may delay recruitment, but it does not mean that economic growth will not eventually be reflected in the labour market as well.

There are already several positive signs in the economy. Growth has spread to labour-intensive service sectors and retail trade. The prolonged decline in job vacancies has also come to a halt: in the second quarter, their number was higher than one year earlier for the first time in almost four years.

In addition, the OMX Helsinki Index has risen by more than 20 per cent over the past year. According to Brotherus, this indicates growing investor confidence in the turnaround of the Finnish economy.

– A virtuous cycle may be beginning. It may take longer than usual for economic growth to feed through to employment, but the outlook is improving,” Brotherus says.

Sources

Statistics Finland: Number of employed persons remained at the same level and unemployed grew in July 2026 from one year ago

More discussion on the topic

Juhana Brotherus commented on the latest employment figures on Kauppalehti’s Talousaamu programme on 25 August 2026. Watch the interview.

Juhana Brotherus on X: View profile

Images and contact details

Lähteet:

Tilastokeskus: Työllisten määrä pysyi samalla tasolla ja työttömien määrä kasvoi heinäkuussa 2026 verrattuna vuoden takaiseen | Tilastokeskus

Lisää keskustelua aiheesta: 

Juhana Brotherus kommentoi tuoreita työllisyyslukuja Kauppalehden Talousaamussa 25.8.2026. Katso haastattelu tästä.

Juhana Brotherus X:ssä: https://x.com/JuhanaBrotherus 

Images and contact details.