Situation room report 19.8.2021 – latest developments in the labor market and firms

August 19, 2021

The Helsinki GSE situation room continues to publish reports based on up-to-date data every other week. The reports follow the economy’s development from the labor market’s, households’ and/or firms’ perspectives. 

The background information for the figures has been collected from the Statistics Finland’s registers.

Key findings

  • Apart from January, the total sum of monthly labor earnings in 2021 has stayed above the levels of the corresponding periods in 2020 and 2019.
  • In June 2021, the daily number of employed (those who earn at least €1000 a month) finally reached the level of 2019 after having remained below it ever since April 2020. The growth seems to have been proportionally larger for higher income groups.
  • Comparing the first quarter of 2021 to that of 2019, the total revenue of firms decreased in some industries and regions while increasing in others. Four of the 10 largest regions in Finland experienced growth in total revenue, while revenue decreased in six of them. Especially hotels and restaurants, support services, logistics and manufacturing declined in revenue while expert services, finance and trade increased in revenue.

Labor market

Labor market – earnings

The figure below shows monthly earnings in 2019–2021 based on the Incomes Register. Apart from January, the total monthly sum of labor earnings in 2021 has stayed above the values of 2020 and 2019, while earnings in 2020 remained below or near the level of 2019. Largest decrease in earnings occurred in May 2020.

When examining the earnings figures, please keep in mind that information is uploaded to the Incomes Register with varying degrees of lag, and the figures may be slightly updated later when new data becomes available. In practice, data older than one month can be considered almost final.

The figure below compares industry-level earnings in July from 2019 to 2021. Earnings in health and social care, manufacturing and public administration appear to have increased the most in July 2021 compared to previous years. Earnings in trade, expert services and communications also increased visibly.

The next two figures show the development of labor earnings in municipalities in July 2019 – 2021. The first figure shows labor earnings in the largest twenty municipalities in July. The second figure shows the ten municipalities with the lowest and the highest changes in labor earnings for 2021 from 2019 levels.

In all of the largest municipalities labor earnings were higher in July 2021 than in previous years. Most of them also had higher labor earnings in July 2020 than 2019. The second figure supports the findings that most municipalities experienced growth in 2021 compared to previous years, as earnings decreased in only two municipalities. Growth in July earnings seems to have been higher in rather small municipalities, for Joensuu and Lappeenranta are the only two of the twenty largest municipalities that made it to the list of 10 municipalities with highest percentage growth.

Next, we examine the changes in earnings in July from 2019 to 2021 by age group. Labor earnings in July 2021 seem to be greater for each age group compared to July 2019 and 2020. Total labor earnings in July seem to have increased especially for age groups 60-64 and 45-49.

The next figure illustrates the relative changes in earnings by profession, listing professions that experienced the largest reductions or increases in earnings in July 2021 compared to July 2019.

Labor market – furloughs and layoffs

The figure below shows the weekly new furlough and unemployment spells from 2019 to 2021. The amounts of new spells increased substantially in the beginning of the crisis, but new entries into unemployment or furloughs have in general declined afterwards. During 2021 the number of new furlough spells has slowly declined to the level of 2019, while the number of new unemployment spells falls slightly below that of 2019.

Labor market – employment

Below, we present the daily amounts of employed in 2019 – 2021. Here, a person is considered employed if they receive at least 1000 euros of wage income over a month. Employment data is slower in updating than earnings data, so recent data should be considered with caution.

In June 2021, the daily number of employed finally reached the level of 2019 after having remained below it ever since April 2020.

Below, we present the daily numbers of employed in 2019 – 2021 by income groups earning at least €3000 or €6000 a month. We find that, compared to year 2019, the number of employed in June seems to have grown proportionately more for higher income groups: the number grew more for people earning at least €3000 than $1000, and the proportional growth was by far highest for those earning at least €6000.

Firms

Firms – revenue

The figure below shows quarterly changes in total revenue by region in 2021 compared to 2019. There’s a lag in the reporting of revenues, so the information of the second quarter will be updated later and should be dealt with caution.

Comparing the first quarter, four of the 10 largest regions in Finland experienced growth in total revenue, while revenue decreased in six of them. Especially Pohjois-Savo and Satakunta had a much higher sum of revenues in 2021 than in 2019. The numbers of the second quarter of 2021 will be updated later, but so far it seems that Pohjois-Savo and Satakunta will grow proportionally most in the second quarter too.

The figure below shows quarterly changes in total revenue by industry in 2021 compared to 2019. Again, there’s a lag in the reporting of revenues, so the information of the second quarter will be updated later and should be dealt with caution.

We find that during the first quarter of 2021, the ten largest industries experienced both growth and decline in revenue compared to 2019. Hotels and restaurants, support services, logistics and manufacturing declined in revenue while especially expert services, finance and trade had an increase in revenue.

  • Additional information about the Helsinki GSE Situation Room consisting of researchers from Helsinki GSE, University of Turku, VATT Institute of Economic Research and Statistics Finland:  https://www.helsinkigse.fi/research-group/covid-19/
  • Additional information about the report: Otto Toivanen, otto.toivanen [at] aalto.fi
  • Suggested citation in mediaCite Helsinki GSE Situation Room as the source with a link to www.helsinkigse.fi website.
  • Suggested citation in academic publications: please contact otto.toivanen [at] aalto.fi
  • Figures and data: https://www.helsinkigse.fi/korona-data/