Finland Faces Economic Woes Amid Rising Unemployment
Finland's unemployment rate hit a 20-year high of 10% in August, amid economic stagnation worsened by the Ukraine war and rising energy costs. The government's austerity measures have curbed growth, with the budget deficit expected to exceed EU limits, as unemployment remains a significant issue.
- Country:
- Finland
Finland is grappling with a 20-year high unemployment rate as it reached 10% in August, according to Statistics Finland. Among Eurozone nations, only Spain reported a higher quarterly unemployment rate, emphasizing the Nordic country's economic challenges in staving off stagnation.
The Finnish economy, impacted by global turmoil and the ongoing Ukraine conflict, suffers from dwindling trade with Russia and an energy crisis inflating costs. The economy shrank by 0.9% in 2023, slightly expanding by 0.4% in 2024, with just a 1% growth forecast for the current year, amid rising unemployment since June.
In response, Finland's right-wing coalition has enacted austerity measures to control the public deficit, yet these cuts have hindered growth and spurred layoffs. The budget deficit is set to rise beyond EU limits, with the debt ratio exceeding EU targets, as Finance Minister Riikka Purra stresses the necessity of government savings despite acknowledging unemployment as a major issue.
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- austerity
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- deficit
- growth
- energy crisis
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