2.9 Labour market

In order to earn an income, most people in Finland have to work. People who are looking for work are said to be on the labour market. Before they have found a suitable job, they are unemployed. In other words, an unemployed person is someone who has no job and who is looking for work. When they find a suitable job and agree on their terms of employment, these people become employed.

Together, the unemployed and employed form the labour force, i.e. the group of people available for work at any point in time. All other people are outside the labour force. For example, pensioners, students and housewives are not seeking work; or if they are, they become unemployed as described in the definition just presented. Children under 15 and persons over 74 are automatically excluded from the labour force.

Labour force and persons aged 15-74 outside the labour force

Source: OSF: Statistics Finland: Labour Force Survey, 2008

When trying to define unemployment there often are borderline cases.

How actively do people have to seek work for this to be credible?

The criterion for active job seeking in Statistics Finland's Labour Force Survey is that the individual reports regularly at an employment office or regularly follows newspapers' job vacancy sections, for example.

How quickly do people have to be prepared to start in a job when something suitable comes up?

The criterion in the Labour Force Survey is that the unemployed person is capable and willing to accept a job offer within two weeks.

What if no employer will have an unemployed job seeker; will this person continue to remain unemployed?

Yes, if this person continues to look for work. What usually happens is that after a period of time the person loses interest and drops out of the labour force. One talks about the long-term unemployed (for people who are still unemployed) and the hidden unemployed (those who are no longer unemployed).

How much work do people have to do in order to be regarded as employed?

One hour a week is enough according to the definition used by Statistics Finland.

The extent of unemployment is measured by the unemployment rate. This indicates how many per cent of the labour force, i.e. the total number of people employed and unemployed, are currently out of work.

The employment rate is calculated somewhat differently: this is based on the numbers employed as a proportion of all people of working age. The age limits are also different from those used in calculating the unemployment rate: only those aged 15-64 are included.