The strength of enterprise is in its diversity

Enterprise has always been a strong component of Finnishness, survival of challenging times, and the building of the new and sustainable. These people who take risks, make a livelihood for themselves and, in the best-case scenario, for others, too, are highly appreciated.

The Finnish population is ageing and record numbers of companies are winding up, making the search for growth opportunities particularly important. Migrant entrepreneurship could be a significant factor in diversifying the economy and the labour market. Instead of just focusing on the challenges, we should direct our thoughts towards solutions and new opportunities.

Back in 2022, more than one in ten of all business owners in Finland had a migrant background. Of migrants who were in work, almost 12% were also self-employed, which is a significantly higher proportion than the native population. This speaks to a desire and ability to run one’s own business. Studies show that, particularly since 2018, the number of businesses founded by migrants has increased significantly, while the native population’s entrepreneurship has remained at the same level or even declined slightly.

Migrant entrepreneurs often operate in employment-dense sectors which provide essential daily services: catering, construction, transport and personal services. In 2021, these businesses employed around 27,000 people in Finland, with a combined turnover of more than €4 billion. Even though most of the businesses are small, their impact is significant. New arrivals to this country often see self-employment as the only option, which forces them to think about how to operate more profitably in industries with thin margins.

However, the trend is slightly problematic: PTT Research finds that migrant entrepreneurs struggle with lower incomes and reduced growth opportunities. The language barrier, perceptions of red tape, and bureaucracy can be barriers even before a potential entrepreneur has tested their business idea. This also applies to business expansion, such as access to finance. Could we develop support structures which consider entrepreneurs’ varying starting points and offer support for them?

Support for growth and enterprise could begin with tangible action, such as migrant specific advice services, mentoring and entrepreneurial training which considers linguistic and cultural differences. Improving access to finance is crucial, as a business that cannot access funds early on, even though it has a strong business idea, can face difficulties. A migrant entrepreneur must also want to adapt to Finnish society and do business on its terms.

A shift in mindset is crucial: migrant enterprise is not a detached phenomenon, but rather an integral part of Finnish enterprise. It does not compete with, but rather compliments and supports overall economic growth.

At its mid-term policy review, the Government resolved to make Finland more appealing in the eyes of highly productive skilled international workers and, in particular, to streamline immigration processes for specialists. These are important goals, as they also support migrants’ access to high productivity sectors.

Studies find that migrant-founded businesses worldwide have succeeded, generating significant growth. In 2022, migrants accounted for 17% of independent business owners in OECD countries, up from 11% in 2006. This trend has created millions of new jobs, and is precisely the kind of growth that the Finnish business scene needs.

Throughout history, Finns have also been migrants, settling in countries like the USA, Canada and Sweden: we are no strangers to being on the move and building a new and better life in another country. Indeed, the conversation should focus more on what the individual can achieve when we believe in them.

With their wide range of backgrounds, migrant entrepreneurs are entrepreneurs just like all others. Every business owner, regardless of their background, deserves support, as diversity is a building block of success. That is how we build a vibrant, sustainable business community.

Authors

Pavel Maksimenko, Chair of the Migrant Entrepreneur Committee, Adeptus Oy

Sonja Antosalo, Specialist, Suomen Yrittäjät