According to a recent report commissioned by the Economic Policy Council, barriers to the geographical or occupational mobility of unemployed jobseekers have not significantly slowed down job placements or raised unemployment in Finland in recent years. This trend appears to be due to the increased concentration of both jobseekers and job opportunities within the same regions and occupational fields, rather than any notable change in jobseekers’ willingness to accept distant positions.
In their report for the Economic Policy Council, researchers Veikko Uusitalo, Merja Kauhanen, and Tuomo Suhonen from the Labour Institute for Economic Research LABORE, and Annika Nivala from the VATT Institute for Economic Research, examine labour market mismatch in Finland between 2006 and 2021.
The study finds that while individual-level obstacles to accepting jobs far from home or in a different field can be significant, their overall impact on unemployment is relatively minor. Regional and occupational mismatch together accounted for, on average, around 12 percent of lost job matches until 2014, after which this effect declined to approximately 5 percent by 2021. The results indicate that this decline is mainly due to the increasing concentration of jobseekers and job openings in the same regions and occupations.
The research methodology is based on search and matching theory and the model incorporates estimates based on Statistics Finland’s registry data of jobseekers’ probabilities of accepting positions across regional and occupational boundaries.
Report:
Veikko Uusitalo, Merja Kauhanen, Annika Nivala and Tuomo Suhonen (2024)
Geographical and Occupational Mismatch in Finland over the Recent Era of Economic Crises: Estimates Using an Interconnected-Markets Approach. Memorandum 1/2024.
The Finnish Economic Policy Council.
More information:
Tuomo Suhonen
Research Director
Labour Institute for Economic Research LABORE
Tel. 040 940 2916
tuomo.suhonen@labore.fi