The Employment Fund’s
Half-Year Report 2020
1 Jan–30 Jun 2020
Managing Director’s review
Strong performance in exceptional circumstances
The impact of the coronavirus pandemic was reflected in various ways in the Employment Fund’s operations in the first half of the year. We switched to working almost entirely remotely as soon as the government of Finland declared a state of emergency. Right at the beginning of the coronavirus outbreak, we realised that the significant increase in unemployment allowance contributions, particularly due to temporary lay-offs, called for exceptional measures to ensure our liquidity and the financing of unemployment daily allowances for unemployment funds.
At the end of March, the Board of the Employment Fund called on the Finnish Government to secure the financing of unemployment insurance. The liquidity of the Employment Fund was ensured by various measures. The Employment Fund agreed on a state-backed standby credit facility with several banks. The government undertook to finance the portion of earnings-related unemployment allowance in a layoff period that corresponded to basic unemployment allowance from April until the end of 2020. In June, we secured our liquidity by issuing two bonds for a total of 1.2 billion euros.
The effects of the coronavirus pandemic were also reflected in increased contacts from applicants for adult education allowances as educational institutions cancelled or reorganised their activities. Despite the exceptional circumstances, the services of the Employment Fund have worked well for our clients.
JANNE METSÄMÄKI
Managing Director
Key figures in January–June 2020
The figures in parentheses include the figures for January–June 2019. The unemployment insurance contributions collected and the payments to unemployment funds also include the state contributions.
Unemployment insurance contributions collected
EUR million
(1 720)
Adult education benefits paid
EUR million
(96)
Contributions to Kela for
persons not covered by
unemployment funds
EUR million
(100)
Contributions to
unemployment
funds
EUR million
(847)
Contributions
from the pension cover of
persons receiving earnings-related benefits
EUR million
(296)
Highlights
for the first half of 2020
The popularity of adult education allowance continues to grow
The number of adult education allowance beneficiaries has been increasing for many years and the pace is not slowing down. In January–June 2020 we paid adult education allowance to 18,170 beneficiaries with a total amount of EUR 98.6 million. The number of beneficiaries increased by 7.7 percent when compared to the previous year.
Fund workers in the midst of distance working
The restrictions set due to the coronavirus pandemic were one of the biggest operational challenges of this spring. Despite the effects of the COVID-19, we managed to cope with our basic duties well. We switched to working remotely with a speedy schedule and learned new working methods.
We secured our liquidity
Layoffs and increasing unemployment due to the COVID-19 pandemic were evident in the rapid growth of the costs we finance. Despite the exceptional situation, we took care of the financing of unemployment and adult education allowances by issuing bonds and making use of the business cycle buffer and loan facilities.
We called on the Finnish Government
In March 2020, we issued an appeal to the Finnish Government to secure the liquidity of unemployment insurances. The state issued a loan guarantee with a maximum limit to EUR 880 million. In addition to this, the state will contribute to the financing of the earnings-related unemployment allowances for layoff periods.