“The increase in long-term unemployment is one of the most worrying phenomena” – 2024-08-27 17:48:59

SAK chairman Jarkko Eloranta at SAK’s labor market seminar in Helsinki on Tuesday. Mika Koskinen

The Ay movement has had a tough year behind it, when Petteri Orpon The (kok) government has weakened the social security of employees and made its working life reforms, which have particularly put the SAK’s ay movement on the back foot.

SAK chairman Jarkko Eloranta according to SAK’s focus is now on the test round, which starts in the fall, and continues well into next spring.

– The labor market round gives rhythm and frames, but of course we should not forget the actions of the government, which also affect the tes round, Eloranta said at the SAK’s labor market seminar in Helsinki on Tuesday.

Eloranta did not want to take any position on the salary increase or text goals of the upcoming round.

However, from the speeches of various ay union leaders throughout the spring and summer, it has already been understood that the ay movement will seek large compensation from employers for the government’s weakening in the upcoming labor market round.

Eloranta listed the weakenings made by the government and stated at the same time that their much-advertised results are still far from expected.

Instead, people’s difficulties in making ends meet have increased, and during the winter the situation will get even worse, according to Eloranta. He referred to e.g. to the gradation of earnings-related unemployment insurance that will come into effect at the beginning of September.

– It’s a big deal, he said.

Eloranta also brought up the fact that unemployment, especially long-term unemployment, is now growing at an alarming rate.

– The growth of long-term unemployment is one of the most worrying phenomena. The longer you are away from work, the longer the journey back to working life, as you get older, your health deteriorates and your skills deteriorate, he said.

Eloranta reminded that in the case of the long-term unemployed, financial incentives rarely affect employment, when the unemployed are already on the basic daily allowance or by falling into it.

He also reminded that the gradation of a total of about 25% of the lowest earnings-related ones will bring the daily allowance almost to the level of the basic daily allowance.

Age discrimination is a big problem

SAK announced the results of its unemployment barometer at the seminar. According to it, age discrimination is the most significant obstacle to employment in SAK’s fields. Age discrimination is especially experienced by people over 50 years old.

– Age discrimination is often related to prejudices regarding the health and skills of older employees, SAK research expert Ari-Matti Näätänen told.

– If they get to show their skills through a work trial or wage subsidy, they are more likely to get a job, he added.

After age discrimination, the most common reasons for unemployment were lack of full-time work and low wages.

According to the survey, the average income of wage-earning jobseekers in SAK’s fields was 1,356 euros, and after taxes, they have an average of 1,012 euros left in their hands.

According to Näätänen, poverty affects people’s health and increases stress.

– The resources to look for a new job are decreasing. Unemployment insurance cuts do not drive people to work, but increase the number of people below the poverty line who cannot get back into working life, Näätänen estimates.

The survey was answered by 1,843 unemployed people in SAK sectors.

Attention to productivity growth

Regarding the upcoming labor market round, Eloranta strongly highlighted productivity development. According to him, competence development should be included more strongly in collective agreements.

– Pakko is a damn good consultant here, he reasoned.

According to Eloranta, improving productivity should also be on the government’s agenda.

– The government has permission to wait for specific means to strengthen the skills of employees, he said.

Eloranta also justified the matter with the fact that the government has decided on cuts in vocational education and ended adult education support.

As one of the concrete productivity measures of the upcoming labor market round, Eloranta highlighted that there is a lot of room for development in the digital skills of employees.

– In the training offered at the workplace, we have lagged far behind other Nordic countries, he said.

Wrong economic policy

SAK’s chief economist Ilkka Kaukoranta according to Orpo, the biggest mistake of the government’s economic policy is that it does not take business cycles into account.

It means that the government’s employment policy is exclusively structural. According to Kaukoranta, many of the government’s solutions, such as cuts in the purchasing power of low-income earners, are weakening employment now.

Kaukoranta also pointed out that the government has not reacted sufficiently to the crisis in the construction industry. According to him, the government’s actions make ARA construction more difficult, and the cut share of the household deduction also affects construction.