Managing Director’s review

The effects of the COVID-19 pandemic were still evident, but we carried out our services in accordance with our objectives

The effects of the COVID-19 pandemic were still reflected in the activities of the Employment Fund in the first half of 2021. Unemployment rates remained high at the beginning of the year, although the number of layoffs started to decrease from the previous year’s highest numbers. We have seen signs of more positive economic and employment developments since late spring. Economic recovery is expected to gain further momentum in the second half of the year.

Despite the challenges posed by the COVID-19 pandemic, we were able to perform our statutory tasks in accordance with our objectives in the early part of the year. This is all thanks to our personnel. We were able to collect a good proportion of unemployment insurance contributions and secure the financing of unemployment benefits.

After the adult education allowance reform entered into force in August 2020, the number of applications increased as the applications are now submitted retroactively on a monthly basis. We have responded to the increase by, among other things, automating the processing of allowance applications. We have been able to process applications and pay benefits in the target schedule.

A new information system developed to support the revised processing of adult education allowances was completed in March. Further development of the system began in April and will continue into 2022.

A large part of the Employment Fund personnel continued to work remotely, as they did last year. In the autumn, depending on the COVID-19 situation, we will assess how we can begin to return to our normal routine. At the same time, we will be preparing for our move to new premises in Ruoholahti, Helsinki.

We reformed our organisational structure

High-quality customer service and the improvement of services through digitalisation are at the heart of the Employment Fund’s strategic goals. Efficient operations, automation, and functional information systems are a prerequisite for achieving these goals. In the spring, we reformed the Fund’s organisational structure so that we could better develop and digitalise our operations and services in the future.

In accordance with our action plan, our activities also included improving the Fund’s information security, developing our internal control and compliance function, putting our customer strategy into practice, and developing our communications.

We participated in the preparation of a new security package

In December 2020, the government of Prime Minister Sanna Marin made a decision to phase out the unemployment pathway to retirement from the beginning of 2023. In practice, this means that additional days of unemployment insurance for the elderly will be completely phased out, and the related employer’s liability component will no longer be collected after the transitional period. These will be replaced by a new security package, which will be funded by the Employment Fund. At the beginning of the year, we started preparing for the future changes and participated in the preparatory legislative work on the new security package in a working group led by the Ministry of Social Affairs and Health.

Possibilities for expanding the Employment Fund’s tasks were examined

The scope of the Employment Fund’s current tasks was assessed by appointed rapporteurs, and their proposals for expanding the Fund’s tasks were presented in June. Expanding the Fund’s role in developing vocational competences among adults was not included in the proposals. However, the assessment included many proposals related to the Fund’s current tasks. The assessment was extensive, and we collaborated with the rapporteurs and provided the necessary information to support the process. Discussions concerning the rapporteurs’ proposals are likely to continue after the summer.

Upward pressure on unemployment insurance contributions for 2022

Unemployment insurance contributions were moderately increased for 2021. In August, the Employment Fund Supervisory Board will make a proposal regarding the amount of unemployment insurance contributions for 2022. The economic outlook for 2022 is currently positive. However, the outlook remains uncertain due to the COVID-19 pandemic, among other things. In May, the Employment Fund’s Board of Directors issued an estimate of next year’s contribution rates. According to the estimate, the amount of unemployment insurance contributions is likely to be raised in 2022.

Janne Metsämäki

Managing Director