Eurocrisis receding? Really? – Finnish edition

This is a post with some links to Finnish language news about businesses in Finland that recently announced redundancies or forced leave in relation to the economic climate in Finland and/or Europe. The list of links is in reverse chronological order, i.e. latest news first. A warning: from this list you wouldn’t know that the Eurocrisis is receding, as some claim.

Construction firm Lemminkäinen aims to reduce workforce by around 500 This is one of the bigger firms in Finland. Around half of the redundancies will be in Finland. The firm employs around 8200 people in total. It has made losses for some time now, and since 2011 there is some kind of efficiency program going on.

Electrobit starts co-decision negotations again to put 1/3 of workforce on forced leave The Oulu region has been hit hard by the consequences of the fall of Nokia.

METSO’s new unit aims for great savings – up to 750 jobs under threat. Earlier this year, METSO split itself in two parts, dividing the profitable mining division and the not-so-profitable pulp&paper industry division over two separate companies. Now the unsurprising news comes that the pulp&paper division will engender brutal savings, threatening up to 750 jobs (worldwide, that is, but still).

Konecranes starts savings program; up to 600 jobs under threat. The producer of cranes intends to reduce its costs.

The situation of Finnish industry is reflected also in transport. The Finnish rail operator VR announced that the amount of freight has drastically shrunken.

Mining company Talvivaara announces to reduce personnel by 250. Either redundancies or forced leave. Added to this is apparently running out of cash. The company has been much in the news with a huge environmental accident earlier this year.

I stop here, this is the (small) selection of news I quickly found for the period of mid-July until today. Some Finnish companies are doing very well, nonetheless. But I think it is rather worrying that construction companies start to get seriously affected, in combination with a slowing real estate market. The slowdown amounts to 10% less sales over the first half of 2013 than in 2012. I and some others have said that there might be a real estate bubble in Finland, and perhaps now we see the bubble slowly or quickly deflate – if the interest rates stay low, probably many can still afford their houses but banks are nonetheless charging more due to stricter regulation.

Some are happy that the Finnish trade deficit is getting smaller, but unfortunately this is mostly because of decreasing imports – a sign of weakening internal demand I guess.

We’ll see. Insofar I have an educated guess, it feels that the eurocrisis has arrived in Finland through the backdoor, although current budget negotiations make much fuss over the share of GDP of Finnish sovereign debt (estimated to reach nearly 60% of GDP next year). To me, the title of that piece is almost funny and very representative of the Finnish mindset: ‘The Finnish public debt level soon overtakes the gargantuan levels of the 1990s economic crisis.’ 60% to my knowledge was a political consensus, mostly because it was the German level of public debt around the time and the other Eurocandidates should have converged to that level. But 60% is not quite a monstrous level, I’d say…

Oh, and of course the Finnish prime minister suggests more budget cuts and ‘structural reforms’ to ‘bend’ the growth curve of the public debt. Just the right medicine. Not.

There are lots of other interesting things going on in Finland right now, including the budget talks and the upcoming collective negotiation rounds, but that is for later posts.


2 responses to “Eurocrisis receding? Really? – Finnish edition

  1. Pingback: More bad economic news from Finland | Arjen polku

  2. Pingback: Aiming for wage moderation in Finland: some thoughts | Arjen polku

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