Local economical crises should be prevented

While municipalities have been able to improve the efficiency of their services, at the same time the government has burden new responsibilities for municipal administrations and its worker (in Finnish, toimihenkilö). This has caused the situation that even municipalities are able to reduce their costs by making their services more efficient, their economical or economic (In Finnish talous) situation is getting worst due to these new responsibilities.

Productivity can be raised to the certain level, but that will not bring the solution for the municipal economical crisis. The solution is neither that functions are transferred to another producer. Tax-funded public services are most likely secure the welfare of citizens in different areas equally. Privately produced services should be used only to supplement the already operating services.

The chairman of Jyty, the Finnish federation of public and private sector employees (in Finnish: palkansaaja), has warned that local government are heading in crisis, which will endanger basic welfare services. There will be most probably heavy shutdowns in many locations.

As the government program states, the municipal policy must be guaranteed equal and quality services throughout the country. The government should now break the old role and together with the municipalities find the ways to address gaps in current services and development the existing resources. It will be challenging, but it might be the only way to ensure the services.

Trade union’s view for the new governmental program

According to STTK, one of the three trade union (in Finnish: ay-liike) confederations in Finland, the key priorities of the new government program are related to fiscal sustainability of national economy and instability caused by euro-zone countries.

STTK is happy with the government’s decisions not to tighten the income taxation of salary earnings. It is the right signal in terms of the employment and purchasing power, and correlates with the goals of STTK. Tax solutions related to the capital taxation are justified by the world economical situation.

However, securing the tax income for the government is crucial in order to keep health facilities and other vital municipal services on a high level of quality and comprehensive manner to all citizens. At the same time, more security should be provided to employers working in these fields: that is essential in terms of employment.

The main task of the current government is, according to STTK, to boost the economic growth and employment. Effective actions to lessen youth and long-term unemployment are necessary. Also the resources for active labor market policies must be enabled. Government should take measures to extend working lives, improve young people's attachment to work, and to prevent work related disabilities.

One of the publicly visible actions in governmental program is to campaign against the grey economy (In Finnish talous). STTK will participate on this campaign also. The campaign will be visible in outdoor advertisements, in police cars and on the Internet in the autumn 2012.

Basic unemployment allowance and the labor market will rise by a hundred dollars per month beginning of next year. The increase also reflects in the earnings-related allowances. This is the government’s way to reduce social inequalities, and therefore is fully supported.

According to STTK, the annual savings and corridor negotiations agreed will ensure a sustainable economic policy. The global economy and the development of the European Union require agility in decision-making.

Municipal consolidations from employer’s side

The consolidation of municipalities in Finland is starting to be everyday news. From big to small, every municipality seems to find a reason to join with neighboring municipalities. Mostly the reason is because savings are seen in merging the municipal administrations, but what will happen to the municipality administrative worker (in Finnish, toimihenkilö) during those consolidations?

At 2005, the government of Finland launched the Best Project (Paras-projekti). The aim of the project was to reform the municipal service structure. Consolidations of municipalities were recognized part of this program. The personnel of municipalities agreed on this project and supported it, which granted them the five year protection against dismissal in the case of any consolidation of municipalities.

The Best Project will end in 2012, but obviously consolidations of municipalities will still happen after that. The trade union of municipal workers has argued that it would be even to have the same five year protection against dismissal also in the consolidations happening after the 2012.

As in any occupation, it is crucial that the job security is maintained. Municipal employment issues are negotiated together with employees and employers' organization, and it is essential that the employees (in Finnish: palkansaaja) remain in spite of the so-called new arrangements.

The other subject of negotiations in the moment of consolidation of municipalities is the salary. When two or more municipalities are combined, the salary differences of similar positions in different municipalities might be considerable. In these cases, the combined municipalities must agree on the harmonization of wages, and the harmonization cannot take a very long time. The same applies to differences in personal knowledge-based bonus systems: they should be co-ordinated.

Finnish willing to increase the social services fees of persons with good income

According to the study of Jyty, the federation of public and private sector employees representing officers (in Finnish, toimihenkilö) and employees at the service of municipalities and the church, a large part of the Finnish population is willing to increase municipal charges for persons with good income. In order to secure the municipal infrastructure and welfare services, nearly a third of Finnish would allow the additional paid services and an increase in municipal taxes.

The majority of Finns agrees that the basic social and welfare services may be supplemented by purchasing services from the private sector where necessary. There is a strong intention, however, to keep the services as part of the municipal service production.

The study also shows, that according to the public opinion, municipal savings should exclude school and health services, and service points should not be eliminated. Other service reductions, layoffs of the staff as well as making a debt in order to support municipal economy (in Finnish, talous) are not supported.

Based on the study, the reductions should be applied to the citizens' juries and other elected political positions. Nearly half of the respondents support municipal merging projects. Other ways to save money are seen in postponing construction works and other big investments.

One-third of the respondents are ready to increase municipal taxes. 62 percent of the respondents, however, consider that the social service and user charges should be staggered so that persons with better earnings would pay more of the services.

The study also investigated the appropriate retirement age and service sector employers' images. On average, Finns think they will stay at working life until they are 64-years old. Differences in occupation, place of residence and the political view are relatively small within this question. The best image of the employers is in the private employers.

The results of the survey shows that social services produced by municipal are valued and citizens are ready to support them heavily in order to secure the services. It would be important also to boost the image of municipal employer.

This study, produced by Jyty, examined public attitudes towards education and welfare services. The survey was carried out by TNS Gallup, which interviewed nearly 5 000 persons in Finnish at 2011. The margin of error of the study was 1.3 percentage in both directions.

Co-operation needed for the political state in Finland

The traditional political map formed again in last government election in Finland. The new political map can make upcoming negotiations of the employment collective agreement difficult. These negotiations held between the trade unions (in Finnish, ay-liike) and employers’ representative.

Finland's challenges before the elections were the same as now: a growth strategy at the national level must be created, employment increased, social exclusion have to be fight against, solutions to the problems of the state economy (in Finnish, talous) found, reform of taxation completed, public services secured and longer career paths supported. Finland should also have an EU policy that is credible.

In order to fulfill these great challenges, seamless co-operation between government and social organizations is needed. In the changing circumstances all parties should find ways to collaborate. Inability to cooperate eats the trade unions’ influence. However, there are problems between employers 'and employees' organizations, but also among trade unions.

For example STTK's chairman estimates that employers have been able to improve internal coordination better than the wage-earners side. In employees' side, each sector has managed lobbying on its own with no common goal. Cooperation has been much talked about, but little is to be seen.
The ability to cooperate is the only way to succeed in the long run. Otherwise, the employers’ side will set the rules, and trade unions can nothing but agree.

Age discrimination in Finnish working life

In work-life, the age discrimination of over 50 year old administrative and clerical employees (in Finnish toimihenkilö) is more common than is generally thought. This is revealed in a study that the Trade Union Pro, which is the union that represents employed workers in Finland. The study was done in 2011.

According to the study, over 55 year old unemployed respondents thought their possibilities to get a new job were poor. Only 6 % of the same age group believed they had a good possibility to get a new job.

In order to succeed in the competition of the employment markets, mature employees need to update their knowhow with supplementary courses. In many cases this possibility is taken away from them, because employers do not want to provide further training for older employees. The study shows that employees over 50 years old are having very little or no possibilities for supplementary courses.

It is not that these employees would not like to have further training: Four out of ten unemployed respondents over 55 years old felt they need to update their knowhow in order to succeed among younger coworkers. Every second person of the same age group has not had any supplementary courses in their working place. This proves that the companies do not see benefits on training mature employees: it is seen more important to educate younger personnel than mature.

Lack of further training

This lack of further training causes problems for mature employees (in Finnish palkansaaja) cumulatively when layoffs are being made. If there has not been the possibility to keep up with development in the specific area of industry, the possibility to get laid off is naturally bigger.

On top of that, the Finnish legal system supports layoffs for more mature employees. When employee over 57 year old is given notice, they are allowed to have earnings-related unemployment allowance until the age of retirement. In Finnish this is called “eläkeputki”, translated roughly as “retirement funnel”.

The study proves that even though the mature administrative and clerical employees would like to continue their working career, they are being laid off since they have the possibility to get into the retirement funnel. As the younger employees do not have similar options, it is often seen fairer by employers to lay off mature ones. The main idea behind this attitude is to lessen the losses of all parties, but this definitely puts more mature employees in an unfair position during layoffs.

All in all, employees over 50 years old don’t have the same opportunities and possibilities in the work-life as younger employees have. The discussion of postponing the age of retirement is ridiculous, if it is compared to the study: how could any career path be longer, if employers do not have the will to make it longer?

Over 40 years old are already facing problems in employment in Finland

According to the study the Trade Union Pro, which represents employed workers in Finland, administrative and clerical employees (in Finnish: toimihenkilö) who are over 40 years old are facing serious problems in their re-employment.

The study shows how the possibilities for unemployed administrative and clerical employees to get a new job decreases strongly after 40 years of age. The decrease is even stronger when the employee gets to the age of 50. The study reveals that from unemployed administrative and clerical employees who were over 55 years old, only 6 % believed they have a good possibility to get a new job. Six out of ten felt that their possibilities of getting a job were poor – on a scale of 4-10 they gave to their possibilities the lowest possible rate. Compared to the unemployed administrative and clerical employees under 45 years old of age, 25 % of under 45 years old rated their possibilities of getting a new job as good. It is not big percent either, but it is definitely more than with over 55 year old.

Finnish Trade Union Pro in 2011

This trend might raise a national-economy problem. In order to rehabilitate the national economy, the government of Finland has a plan to extend a person’s career by postponing the age of retirement. At the same time when the government supports longer career paths, the study shows that employers are not seeing the similar benefit of giving or keeping older employees. The diverse fields of the respondents also proves that this problem is not only affecting one field of the economy, but reflects the wider opinion of employees (in Finnish, palkansaaja) in Finland.

The research was based on a questionnaire conducted by the Finnish Trade Union Pro in 2011. The questionnaire was sent to trade union members, and the answers were gathered from 5421 members who were over 50 years old. Respondents were working in the fields of industry, services, ICT, communication and finance.