Major unemployment fund merger takes new steps forward

Helsinki 12.03.2021 – Heikki Jokinen

Plans to create a major new unemployment fund are proceeding apace. However, one of the funds originally expected to be part of the merger pulled out but will now be replaced by another fund.

In Autumn 2020, the Public and Welfare Sectors’ Unemployment Fund, the Unemployment Fund of Finnish Industrial Workers and the Unemployment Fund of the Construction sector announced their plans to amalgamate.

In February, the funds engaged in the amalgamation plans said that the Public and Welfare Sectors’ Unemployment Fund is no longer involved in the merger plans. But there is now another fund that wishes to join, Finka. This is a fund that covers journalists and perfoming artists, like musicians, singers and actors.

The new unemployment fund, set to operate from the beginning of 2022, will be the third largest in Finland. At the beginning of 2020  the Unemployment Fund of Finnish Industrial Workers had 139,172 members, the Unemployment Fund of the Construction sector 45,590 members and Finka 18,888 members.

The plans are to make the new, still unnamed, unemployment fund open to all. At present, union related unemployment funds are invariably limited to those working in a particular union sector. This new fund if it were to happen would make it a strong competitor to the YTK unemployment fund. The latter is a major one in Finland and has no ties with the trade union movement.

Interestingly too, the proposed merger crosses over trade union confederation borders.Of the unions behind the three funds, the industrial workers’, construction workers’ and musicians’ unions are members of the Central Organisation of Finnish Trade Unions SAK. The journalists’ and actors’ unions do not belong to any trade union confederation.

In 2020, out of all unemployment fund members, on average, 24 per cent have been receiving unemployment benefits, at least for some part of the year. This figure was higher still in all of the soon-to-merge three funds: 38 per cent for the industrial workers fund, 35 per cent for the construction workers fund and 28 per cent for Finka.

It should also be noted that this latest merger is part of a trend: the number of unemployment funds have been falling constantly during the new millennium. In 2000, there were 48 funds in Finland. Right now, the number is 20 for wage and salary earners and one for entrepreneurs.

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