Survey: Almost 40% of businesses having difficulty finding employees

The labour shortage shows no signs of easing. As many as 39% of companies have said they have difficulties recruiting new employees, the new Yrittäjägallup survey shows.

The labour shortages are most acute in industry and construction, where over half of the companies have difficulties finding employees. The business owners that responded to the survey propose, in particular, local bargaining and shorter unemployment benefit periods as solutions.

The labour shortage has worsened since May and August 2022, when the previous surveys were conducted. More than 66% of companies which employ five people or more have difficulties filling posts. The situation is equally bad all over Finland, roughly.

For one company in four (26%), the labour shortage is a barrier to growth.

“This highlights how serious the problem is, because the less growth we have, the more we have to cut spending in future parliamentary terms,” Mikael Pentikäinen, CEO and President of Suomen Yrittäjät, the Finnish SME association, says.

The business owners who responded to the survey proposed several effective methods to reduce the labour shortage, both by reforming regulations and taking action in companies.

The most important method raised was reducing ancillary payroll costs (46%).

“This tells us that our pension system and the returns it generates must be made more effective, and that the sick pay system must finally be reformed. “It’s unreasonable that a small employer pays on its own expense, for example, the salary costs of an employee who falls ill while not at work, without being compensated in any way,” Pentikäinen says.

Other important means include increasing local bargaining (35%), easier dismissal on personal grounds (33%), easier fixed term contracts (31%), and reforming social security to incentivize people to take up work (26%).

Since last August, increased local bargaining and shorter unemployment benefit periods have gained support as remedies for the labour shortage.

In-house measures raised were local bargaining (30%), offering internships (27%), cooperation with educational institutions (25%), using temping agencies (18%), and bonus systems (15%). In particular, the significance of local bargaining has grown since last autumn.

Suomen Yrittäjät argues that the structures of the Finnish labour market prevent and slow down employment.

“That is why we have over 300,000 people aged 25–59 outside employment and over 250,000 unemployed. At the same time, we have an enormous labour shortage and the number of employer businesses is falling rapidly. The number of business owners who are also employers has shrunk by almost 10,000 in recent years. That is a significant drop,” Pentikäinen says.

This is why Suomen Yrittäjät argues that the next government’s key task is to overhaul the Finnish labour market by making recruitment easier and lightening employers’ load.