Valtiovarainministeri Riikka Purran puhe Nordic Economic Policy Review'n julkistustilaisuudessa

Valtiovarainministeri Riikka Purra piti avauspuheenvuoron Nordic Economic Policy Review'n julkistustilaisuudessa Helsingissä keskiviikkona 7. toukokuuta

Dear professors, dear friends, good morning everyone,

Thank you for giving me this opportunity to open the launch of the 2025 issue of the Nordic Economic Policy Review that focuses on wage formation and the Nordic model, and to briefly share some of my thoughts on related policies. 

But first, I would like to thank the authors and editors for their contribution in improving our understanding of one of the possible drivers behind the Nordic success.

The Nordic countries have a lot in common. A long shared history has shaped countries to be culturally and socially similar. The Nordic population is among the most highly educated in the world and the countries are investing in research co-operation both in the Nordic countries and with international partners. Also, the structures of government are close to each other, and societies learn from each other. 

Thus, apart from minor differences, the institutions and legislation of the labour market are quite identical as well.

The Nordic model has been very successful. The Nordic countries have succeeded in combining the rapid long-term growth in real wages with small pay gaps. The Nordic countries are all among the least unequal countries in the world. At the same time, employment rates have remained high.

The other Nordic countries are often the most important reference group for Finland. Similarity between the countries makes comparison easier, and examples and new solutions for developing society are sought primarily from the other Nordic countries. For instance, the government has even recently made decisions on tax reforms performed in Sweden earlier, with encouraging results.

More generally, the government will develop the Finnish labour market in a more flexible direction, again paying close attention to what has been done in other Nordic countries. The aim is to support employment, economic growth, competitiveness and productivity development. Finland desperately needs economic growth other Nordics enjoy.

The report to be launched today analyses many of the important issues and policies involved in developing the Finnish labour markets. Instead of country-specific phenomena, NEPR articles discuss labour market institutions from a supranational perspective. This is welcome and will likely give us better discussion and arguments. The experiences of neighbouring countries can easily be compared.

One of the basic principles of Nordic co-operation is that the countries are stronger together than alone. Nordic political co-operation is one of the most extensive and long-term in the world. The Nordic countries have an open labour market that has enabled Nordic citizens to work throughout the Nordic Region for over 60 years. Still there are many border barries left too - as anyone who has participated in the Nordic Council very well knows. 

Our security and defence cooperation is stronger than ever.

Many Finns have experience of working in other Nordic countries. In an integrated market, it is common to move within an enterprise to another country or to work as a posted worker. A unified culture, but also a common labour market, will facilitate integration into the new labour market and the Community. Posted workers are not always covered by collective agreements. The report's observations on extending collective bargaining gives important insight on policy planning.
 
The Nordic model has been praised for fostering economic stability and social cohesion, but it also faces challenges, such as adapting to structural changes in the economy. In the Nordics, significant proportion of workers are unionized. The degree of unionization has lately decreased. This could be a result of changes in working life, but also due to changes in institutional settings.

The technological changes are reforming Nordic industries and jobs. The share of service sector is increasing and international trade on services has become important source of value added in the Nordics. Ageing society also increases the need for service workers. Demographic changes and diversification of societies reshape and challenge the Nordic model. 

This Nordic Economic Policy Review issue is a fine example on how to shed light on these issues and improve our understanding, not only on the functioning of the Nordic labour markets, but also on how they are constantly evolving as reactions to societal and industrial developments. At best, independent research can bring us evidence on which we can base our policy design to improve outcomes.

With these words, I wish you all not only a fruitful and policy-relevant debate, but also a pleasant rest of the day.