The Finland employment decline continues to make headlines as recent data from Ilmarinen highlights a reduction in staff numbers across many sectors. In January, the number of employees in companies tracked by the pension insurer fell by 0.6 per cent compared with the previous year. This marks two and a half years of consecutive decline in Ilmarinen’s business cycle index. In December, the annual decrease stood at 0.5 per cent.
The index, which covers over 50,000 companies and roughly 600,000 employees, monitors ten key sectors representing most of Finland’s private sector workforce.
Despite the overall downturn, some sectors experienced growth in January. Transport led the gains with a 2.4 per cent year-on-year increase. Administrative and support services grew by 0.7 per cent, accommodation and food services by 0.6 per cent, and industry expanded by 0.4 per cent.
Researcher Jouni Vatanen noted that the employment decline has reached a significant milestone. “Unfortunately, the decline in employee numbers in our index has now reached two and a half years,” he said. He added, “I believe that as we move towards spring we will see positive growth figures.”
Vatanen pointed to western Finland as a key area of resilience. “Positive signs were visible in January in western Finland, which already performed best in the country last year,” he said. Industrial orders also increased at the end of 2025, and the region hosts several major industrial firms.
Regionally, western Finland recorded growth of 0.5 per cent. Northern Finland remained stable compared with the previous year, southern Finland saw a decline of 1.0 per cent, and eastern Finland posted the largest regional fall at 1.6 per cent. Northern Finland also recorded notable growth in accommodation and food services of 5.9 per cent.
Some sectors continued to experience significant setbacks. Social and health services reported the steepest annual decline, with staff numbers falling by 2.5 per cent. Construction followed with a 2.3 per cent drop, and information and communication decreased by 2.2 per cent.
“Construction has faced weak conditions for a long time, influenced by the broader state of the economy,” Vatanen explained. He emphasized that a recovery in construction would support both employment and consumer confidence.
Additionally, purchasing power returned at the end of 2025 to levels seen before the inflation surge of 2022 and 2023, providing a potential boost to private sector employment.
Ilmarinen has published the business cycle employment index since 2013. It provides a comprehensive view of workforce trends in Finland’s private sector, offering valuable insights for policymakers, businesses, and analysts.
