Transforming Work and Industry in Finland
Finland, a country of modern technology and the Nordic welfare model, is currently facing a profound restructuring of its economy and labour market. From the electrification of the automotive industry and the development of renewable energy, through reforms in the public care sector, to the deregulation of transport and the expansion of digital platforms, each of these processes shows how dynamically the balance between the state, the market, and the world of work is changing.
The Finnish socio-economic development has been shaped by a rapid but late industrialization, the implementation of Nordic welfare state model, and later shifting from manufacturing and heavy industry towards knowledge-based and service work. Global recessions and geopolitical crises have slowed down Finnish economic growth since the 2008 financial crisis.
The automotive production
The automotive production has remained on a small scale compared to other European countries, although Finland nonetheless has some local automobile production. The Valmet Automotive Uusikaupunki car factory has been in operation since the 1960s, originally a joint venture between Valmet and Saab Automotive. It is currently majority owned by the Finnish state. It assembles cars as a contractor producing for various OEM brands (such as Mercedes). It remains as an important local employer regardless of waves of hirings and layoffs, depending on contracts and production volume. Valmet Automotive workers have union representation, and the national technology industry collective agreement is applied at the workplace. Valmet Automotive has expanded their field of expertise to car battery manufacturing in Finland and Germany as a response to the electrification of cars and transport. Additionally, private Sisu-Auto manufactures trucks and military vehicles.
The energy sector
The energy sector has been shifting towards renewable energy production, although nuclear power remains an important piece of the energy mix. Many coal plants have been closed, and Finland’s only domestically extracted fossil fuel, peat, is also being phased out. Wind power has been expanding rapidly, accelerated by policy incentives and subsidies. Finland has a significant amount of hydropower, but with little potential for expansion, since most good locations for hydropower capacity are already in use. Considerable biomass electricity powerplants were built in recent years. This has been controversial due to skepticism about the availability of fuel and its ecological sustainability. Electrification and planned datacenters around the country will increase demand for electricity production while the war in Ukraine has highlighted the need for energy security. The workers in the legacy energy production are unionized, although it is unclear how much renewable energy sites will employ current workers, and whether they will be unionized.
Care sector
Finnish care sector has undergone significant changes in the last few decades. Majority of care services are provided by the state. The population is ageing, and birth rates are declining, causing issues with demand and supply. The recent restructuring of social sector into well-being service regions has created a situation where some regions have cut their care services and laid off employees to make their budget targets, sometimes causing local unemployment for care workers and nursing staff. The need for health care personnel persists but paradoxically they might not find employment. Union representation of health care workers is vocal and well-established, although they do not enjoy significant power in negotiation settings. Budget cuts and layoffs could end up forcing care workers to accept worse working conditions and wages, while more vulnerable workers could be taken advantage of. New technologies are introduced in the care work, such as monitoring safety devices, and medicine dispensing robots. Applications are more central to care work, as well as remote healthcare services, changing the way care work is being done.
On-demand transportation
On-demand transport sector used to be highly regulated in terms of taxi services, and operators required licenses which were limited in numbers. Ride-hailing company Uber lobbied politicians hard in 2014-2018 to renew the taxi laws. As a result, in 2018, taxi regulations were abruptly deregulated, fundamentally transforming the industry as the entry threshold dropped from very high to very low. New taxi operators and ride-hailing service providers, such as Yango and Bolt, entered the market. Taxi drivers were mostly unionized before 2018, while platform workers are not widely presented by unions. However, ride-hailing drivers have been vocal about their working conditions and even held a demonstration in 2024 in Helsinki to improve working conditions and for fair wages. It remains to be seen whether taxi drivers’ union will open their doors to ride-hailing drivers or if they will unionize separately. As of 2025, the competition between taxis and ride-hailing services is intense and prices between independent taxi entrepreneurs, established taxi companies, and ride-hailing services vary significantly. Some changes in the taxi laws are expected later in 2025.