Finland has been rocked by large-scale strikes for months now. The upcoming one starts Tuesday. The protesters come from the transport sector, postal service and the utilities. Students have joined in too. Millions of Finns are outraged by the government cuts to social benefits, lower wages and worse working conditions. All of this has to do with the economic falling-out with Russia.
Finland is being swept by a wave of protests in various industry sectors. 6 February saw the beginning of a strike staged by the Confederation of Unions for Professional and Managerial Staff (Akava). The rally was joined by Talentia Union of Professional Social Workers represented by the early childhood education specialists.
On 31 January, transport sector unions initiated a series of one-day strikes. The move temporarily brought to a standstill most of the air travel industry. Finnair cancelled almost all of the 2 February flights. Train service, barring northbound night rides, was halted for an entire day. So were metros and trams. Employees of restaurants, hotels and stores left did not report to their workplaces. Port staff joined the demonstration, too, as well as postal workers.
The country’s Industrial Union (Teollisuusliitto) announced three-day work stoppages at several heavy industry production sites scheduled for 14–16 February 2024. The mass demonstration will involve about 60,000 those employed in construction, refineries, chemical manufacturing and sawmills. According to Riku Aalto, the chairman of the Industrial Union, the coming strike is justified as he believes the government has ignored the unions’ stance.
Indeed, the Minister of Economic Affairs, Wille Rydman, unloaded on the unions, branding the movement as the ‘Hakaniemi mafia’ (the Central Organisation of Finnish Trade Unions (SAK) is headquartered near the Hakaniemi Market Square in Helsinki). According to Minister Rydman, the unions do not care about the retention of jobs, Finland’s economic competitiveness, economic growth or ‘the interests of our homeland and the employees’.
This action was preceded by a large-scale 14 December strike in the transport sector orchestrated by SAK. The organisation was outraged by the employment policy and welfare reforms. The unions had been waging the longtime Serious Grounds campaign seeking to protect workers from the government-initiated cuts. The previous one-day nationwide protest took place on 7 November 2023. The rally was joined by employees from utility, catering and recycling industries, among others.
Earlier, Finland had been hit with a cascade of strikes in various industry sectors in H1 2023. In September, SAK announced a new round of action, including brief strikes, demonstrations and pickets. The organization claimed that the government had left them no choice. ‘That’s our way of protesting cuts to social benefits and deteriorating working conditions proposed by the Petteri Orpo government,’ the unions’ leaders say.
No Happy Soul
In the spring of 2023, Finland held a general election that ended in the Social Democrats losing the executive offices. The new Cabinet was formed by the National Coalition Party, the Finns Party, the Christian Democrats and the Swedish People’s Party of Finland. The new government issued a list of changes to be introduced to the labour market. Below is a rundown of this document.
One, it facilitates the dismissal process. Two, the employers are allowed to sign temporary employment contracts that were previously invalid. Three, there is a possibility of your first sick day going unpaid. Four, the officials propose a step-by-step system for cutting your unemployment benefits. Five, the Orpo government aims to limit people’s right to strike. Six, employers may be allowed to cut salaries, increase working hours and provide a worse vacation package.
By introducing these changes, the government seeks to slash the general government deficit as in 2024, Finland’s government debt amounted to €11.5bn. It will involve cutting unemployment allowances and cancelling employment insurance plans, which will shift the risks from the employers to the employees.
Sure enough, the workers are riled by the way the government seeks to save the money, even though there is no denying that the country is slumping, and statistics prove just that. At the end of 2023, Finland had over 190,000 unemployed individuals aged between 15 and 74, up 26,000 YoY. Besides, last year 3,293 Finnish businesses filed for bankruptcy.
If the recent data is something to go by, only one in ten large Finnish companies seek to expand its operations in 2024 as opposed to one in three companies two years ago. The businesses are looking for a further dip in the nation’s economic growth. Large companies fear inflation, increased funding costs and lack of employable talent.
The unions do agree that the government should be handling the crisis, except in some other ways. ‘It’s not your economic austerity budget. The government provides tax exemption for the rich, for example, by lowering the tax burden for earners of €80,000 per year. It seems to follow the reverse Robin Hood principle as they take away the money from the power to hand it over to the rich. Therefore, it’s an economic austerity budget for the poor,’ says Jarkko Eloranta, the president of SAK.
The Heavy Price of Russophobia
Finland’s slump is further exacerbated by its economic falling-out with Russia. ‘The lack of interaction with Russia has indirectly impacted 80% of the Finnish market. Finland’s economy used to bridge the gap between the East and the West. By spurning this role, it inflicts serious self-damage. But the Finnish media does not provide the exact figures. In any case, we are talking billions of euros in losses. The Finnish government can say all they want, but cancelling the interaction with Russia in the atomic energy sector alone and maybe even the whole energy sector has damaged the nation’s economy,’ Natalya Eremina, PhD in political science and a professor at the St. Petersburg State University, has told.
She adds: ‘According to Nasdaq Helsinki, the net losses of the Finnish companies that had to pull out of Russia have amounted to more than €4bn. The large players include YIT, Fortum and Nokyan Tyres. Sawmills and cardboard producers who used to sell their products to Russia have also taken a major hit.’ Predictably, the researcher names the regions bordering Russia as the most affected.
Reasonable people often dub eastern Finland as the victim of geopolitics. In his Kauppalehti opinion piece, journalist Mikko Metsämäki notes that these parts of the country have turned into a ghost region due to the absence of Russian tourists, and it now faces the daunting fate of being ‘the refuge of the elderly and fringe elements’. Metsämäki says that the shops Imatra, a town bordering Russia, were completely deserted at the height of the summer holiday season. Much to the Finns’ chagrin, the journalist cites the following data. Before the pandemic and the sanctions, Russian tourists were shopping for a total of up to €1mln daily, which is a very big deal for the small region of South Karelia. Travel industry-oriented eastern Finland is now dealing with a higher unemployment rate and less optimism than the rest of the country.
The crisis has taken a toll on the entire sectors of the manufacturing industry. For instance, Risto Huovinen, a municipal deputy in Lappeenranta, says: ‘Thousands of employees at UPM, a major forest industry company, are forced to take indefinite leave as they can no longer buy timber from Russia at a reasonable price…
‘Finland’s inflation rate is surging because we are not getting fossil fuels from Russia anymore. Consequently, the product prices have gone up lowering the Finns’ purchasing power. All this has contributed to the destruction of the economy and the reduction in jobs.’
Before 24 February 2022, some 800 Finnish businesses had been exporting their goods to Russia. In the summer of 2023, this figure plummeted to just 160. Olli-Pekka Penttilä, director of statistics at the Finnish Customs, admits that only 16% of the companies that pulled out of Russia have made up for their losses. ‘Finding new trade partners in our current export markets, let alone new markets altogether, is a tall order,’ comments Jaana Rekolainen, the CEO at EastCham.