Labour market flows run deeper : Participation has raised both employment and unemployment

Abstract

A key feature of recent developments in the labour market in Finland has been an increase in the participation rate. Inflows into the labour force have exceeded outflows. For some time already, this has been evident particularly as a rise in employment, but in recent years also as a simultaneously high rate of unemployment. The increase in the participation rate is due to people retiring later than before, the more active participation of the youngest cohorts, and the notably high proportion of people of active working age among immigrants. In the current weak economic conditions, the higher labour market participation has also contributed to a rapid rise in the unemployment rate.