Visa Crunch

Finland Requires Work-Based Immigration Regulations For Every Sector: Report

A study commissioned by the Confederation of Unions for Professional and Managerial Staff in Finland, Akava, indicates that increased work-based immigration would have a positive impact on the economy.

The report provides alternative assessments of how different types and levels of immigration would impact the nation’s gross domestic product.

“The message of this report is that work-related immigration is needed for every industry and every professional group,” says Olli-Pekka Ruuskanen, Director of Research at Pellervo Economic Research. The impact of work-based immigration was explored through four scenarios.

The scenario of a shrinking labour force is based on a Statistics Finland’s 2019 forecast of 15,000 people from abroad entering the Finnish workforce annually. This is not enough to replace workers leaving the labour market, which would weaken the economy.

The replacement scenario assumes that working-age immigrants would make up for losses as more people exit the workforce. This would require an increase of about 5,000 work-based immigrants each year, in addition to Statistics Finland’s projected figure. These immigrants are assumed to be between the ages of 15 and 64 and are expected to be employed immediately in full-time jobs. In this case, the number of workers remains the same.

The steadily growing labour force scenario assumes that the number of people immigrating to take up jobs would increase by 6,000 in the 2020s and by 10,000 in the 2030s. In this scenario, immigrants would fill positions in all occupational groups.

The technology experts scenario also assumes that the volume of work-based immigration would increase by 6,000 in the 2020s and 10,000 in the 2030s. Here, however, immigration would focus on recruiting highly educated immigrants for jobs in high-tech industries.

This final scenario would best drive economic growth, the study found. However, there is a sharp international competition for this kind of talent, so convincing them to move to Finland is seen as a challenge. On the other hand, the difference between this option and the steadily growing labour force scenario is small.

“It cannot be said that there are only certain professional groups that would be particularly needed. This is due to the ageing of the population and the fact that we are facing an unprecedented level of retirements,” Ruuskanen points out, emphasising that labour is a key factor in economic growth.

“Say we have two shovels and two people digging trenches. One of them is retiring, so it’s hard for one person to use two shovels. Indeed, it takes more hands to be able to utilize that capital asset,” Ruuskanen explains.

He adds that if the size of the working-age population declines, investments and technological development will not have a major impact on economic growth.

“GDP is a multiple of the work done. For example, the machinery and equipment that are acquired through investment only help the employee to achieve higher rates of production,” Ruuskanen stresses.

The study, commissioned by Akava, was produced by the Pellervo Economic Research and Merit Economics.

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