Finland unemployment rose to its highest level this century in May 2026, with 376,000 people aged 15 to 74 out of work, according to new Labour Force Survey data from Statistics Finland (Tilastokeskus). The figure is 68,000 higher than one year earlier and marks the largest monthly number of unemployed people recorded in Finland since 1998.
Finland unemployment reaches a post-1998 high
The non-seasonally adjusted unemployment rate for people aged 15 to 74 reached 12.7 percent in May, up from 10.5 percent in the same month last year. Statistics Finland also reported that the number of employed people fell by 32,000 year-on-year, to 2.59 million.
The figures confirm a worsening trend in Finland’s labour market, even though May is usually a difficult month to interpret. Unemployment often rises at this time of year because students and recent graduates enter the labour market and start looking for summer jobs or their first permanent positions.
That seasonal effect does not fully reduce the significance of the data. The number of unemployed people has reached a level not seen in Finland for almost three decades, while the employment rate trend for people aged 20 to 64 has fallen to 75.2 percent. According to Statistics Finland, that trend is now close to levels last recorded during the Covid-19 pandemic.
The increase affected both men and women. There were 203,000 unemployed men and 173,000 unemployed women in May. Compared with May 2025, the number of unemployed men rose by 40,000 and the number of unemployed women by 28,000.
Young workers face a more competitive Finnish labour market
The data also show growing pressure on young people. The trend youth unemployment rate for people aged 15 to 24 stood at 23.2 percent in May, while the non-seasonally adjusted share of unemployed young people in the labour force was 37.8 percent.
Joanna Viinikka, Senior Statistician at Statistics Finland, said the increase reflects an “extremely competitive” labour market for young people seeking summer work or their first job after graduation.
This is particularly relevant in Finland, where transitions from education to employment are closely tied to the country’s broader welfare and skills model. A prolonged rise in youth unemployment can weaken early career prospects, delay economic independence and place additional pressure on public employment services.
The rise also comes at a time when the labour force remains high. That means more people are either working or actively looking for work. In normal conditions, a high labour force can support economic growth. In Finland’s current labour market, however, it also means that weak demand for workers is translating into higher unemployment rather than stronger employment.
Weak labour demand keeps Finland behind the euro area
Finland’s labour market has performed worse than much of the euro area in recent years. The Bank of Finland has linked the deterioration to weak economic conditions and especially to low demand for labour. While labour supply has increased, job vacancies have fallen sharply from the strong levels seen in 2021 and 2022.
The Ministry of Economic Affairs and Employment (Työ- ja elinkeinoministeriö) expects only a slow recovery. Its latest labour market forecast says unemployment is likely to remain high in the short term, at around 10.2 percent in 2026, before gradually falling to 9.8 percent in 2027 and 9.3 percent in 2028.
The ministry expects employment growth to become more visible in the next few years, with 18,000 more employed people in 2027 and 25,000 more in 2028. Long-term unemployment is also expected to start declining after the summer of 2026. However, the forecast suggests that Finland’s labour market will not return quickly to the stronger conditions seen before the current downturn.
Government reforms meet a difficult jobs market
Prime Minister Petteri Orpo’s government has introduced several reforms aimed at increasing employment and strengthening incentives to work. These include changes to employment services, unemployment security sanctions and rules affecting jobseekers.
Some of the reforms are intended to make the job search process more binding and to clarify sanctions when jobseekers do not meet agreed obligations. Other changes, including more flexible rules for fixed-term employment contracts, are designed to lower barriers for employers.
The political challenge is that these measures are being introduced while the labour market remains weak. Stricter obligations may increase pressure on jobseekers, but they cannot by themselves create vacancies if companies are not hiring. This is why the latest data have wider political significance: they test the government’s argument that labour market reforms can improve employment in a period of sluggish economic demand.
For Finland, the issue is also European. The country remains part of the Nordic welfare model, where high employment is central to financing services, supporting social cohesion and sustaining trust in institutions. A prolonged labour market downturn would therefore matter beyond monthly economic statistics. It would affect young people, public finances and Finland’s position within a euro area where employment has generally proved more resilient.
The coming months will show whether the May increase was partly amplified by seasonal factors or whether it marks a deeper deterioration. For now, Finland’s labour market is sending a clear signal: the recovery expected by policymakers has not yet reached many jobseekers.
