Press release

Global economy slows down, but Finnish technology industry clings to growth

Thu, 04/25/2019 - 11:53
Global economic uncertainty continues to dampen export expectations, but Finnish technology industry is still clinging to growth. Economic growth has declined rapidly also in the euro area including Germany, which is an important export market for Finland. Despite the slowdown, the value of technology industry companies’ order books strengthened and the value of new orders remained at a good level in early 2019. Industry personnel also expanded.

“Despite the heightened uncertainty of global economic outlook, the situation of the technology industry in Finland remains surprisingly strong. However, the slowdown in economic growth raises concerns over future industry outlook and challenges. The competitiveness of companies is the key in the determination of market shares in the future,” says Jukka Palokangas, Chief Economist at the Federation of Finnish Technology Industries.

According to the recent order book and personnel survey published by Technology Industries of Finland, the value of order books at the end of March was 6 per cent higher than at the end of December, and 14 per cent higher than in March 2018. Shipyards’ order books contribute an exceptionally large share of orders.

The value of new orders also remained at a good level. The technology industry companies that took part in the survey reported that the monetary value of new orders between January and March was at the same level as in the preceding quarter, but 14 per cent higher than in the corresponding period in 2018. The number of requests for tender received by technology industry companies continued to increase at the approach of spring after a drop towards the end of 2018.

Judging from order trends in recent months, the turnover of technology industry companies is expected to be higher in the spring of 2019 than in the corresponding period last year.

At the end of March, the industry employed some 318,500 people, up slightly more than 3 per cent from the 2018 average.

New government: Focus on employment and strengthening growth

The CEO of the Federation of Finnish Technology Industries Jaakko Hirvola is glad to see that the Finnish technology industry companies and their products have fared well in an increasingly challenging market situation. In terms of employment targets, it is nevertheless essential that the new government does everything in its power to accelerate growth, which is required to create jobs.

“We need to do the best we can ourselves. All future projections indicate that unlike the past few years, we cannot expect the global economy to give us a push over the new government term. We must make a firm commitment to ensure that our industry operates in an internationally competitive environment, can find skilled employees and has professional development, research and innovation functions that keep pace with development,” Hirvola points out.

According to Minna Helle, Director, Labour Market at the Federation of Finnish Technology Industries, the collective bargaining that will take place this autumn will also have a significant impact on growth and employment.

“Responsible, export-driven wage negotiations play a key role in this situation. It is important to keep a cool head, because the global economic outlook involves many risks. Should economic growth contract further, global competition will intensify, which will be a true test to the competitiveness of companies. While Finland’s competitiveness has been going in the right direction in recent years, there is still room for improvement,” Helle points out.

PDF iconfinnish_technology_industry_outlook_22019_slides.pdf

Further information:

Jaakko Hirvola, CEO, phone +358 40 063 3751

Jukka Palokangas, Chief Economist, phone +358 40 750 5469

Minna Helle, Director, Labour Market, phone +358 40 341 4884