Published by Global Banking & Finance Review®
Posted on October 21, 2025
2 min readLast updated: January 21, 2026
Add as preferred source on GoogleIn August, Finland's unemployment rate hit 10%, the highest in 15 years, due to economic stagnation and global challenges.
(In September 23 story, corrects headline and first paragraph to say ... at least 15 years ...not... 20 years. Adds note in paragraph 4 to show that comparable unemployment data series only goes back as far as 2010.)
HELSINKI (Reuters) -Finland's monthly unemployment rate rose to 10% in August, the highest level in at least 15 years, data from Statistics Finland showed on Tuesday, as the Nordic country struggles to stave off a persistent economic stagnation.
In the second quarter of the year, only Spain's quarterly unemployment rate, at 10.29%, stood higher among euro zone member states than that of Finland at 10.2%.
The Finnish economy has been hit hard by global economic turmoil and uncertainty stemming from the war in Ukraine, with trade with neighbouring Russia drying up and export companies hampered by the subsequent energy crisis pushing up costs.
Finland's economy contracted 0.9% in 2023 and grew by 0.4% in 2024, while its finance ministry on Monday forecast sluggish 1% growth for this year. The monthly unemployment rate has been rising again since June after a dip in May. August's unemployment reading was the highest in the statistics office figures, which go back as far as 2010.
Amid the economic malaise, Finland's three-party right-wing coalition has introduced austerity measures and spending cuts to contain public deficit growth but the measures have also dented economic growth and led to layoffs.
Finland's budget deficit is set to rise to 4.3% of gross domestic product this year from 3.7% in 2024, the finance ministry said, above the EU's ceiling of 3%, while the Finnish debt ratio is set to rise to 86.9% of GDP, also above the EU goal of 60%.
Finance minister Riikka Purra, of the nationalist Finns Party, defended the government's economic policies on Tuesday as parliament discussed next year's budget, calling Finland's budget deficit "a chronic problem and therefore even more dangerous".
"The public must not be misled into thinking that savings need not be made," she said, while acknowledging that "unemployment is our biggest problem at the moment".
(Reporting by Anne Kauranen in Helsinki and Elviira Luoma in Copenhagen; Editing by Alison Williams)
Unemployment refers to the situation when individuals who are capable of working are unable to find a job despite actively seeking employment.
Gross Domestic Product (GDP) is the total monetary value of all goods and services produced within a country's borders in a specific time period.
Economic stagnation is a prolonged period of slow economic growth, typically characterized by high unemployment and low consumer demand.
Explore more articles in the Finance category
