Finnish Tech Industry Outlook

Technology Industry /
Finnish Economic Outlook
November 2020
Jukka Palokangas
Principal Economist
jukka.palokangas@techfind.fi
111/27/2020 Technology Industries
of Finland

The Finnish Technology Industry Is Comprised of
Five Sub-Sectors
of Finland
ELEKTRONICS AND ELECTROTECHNICAL
INDUSTRY
ABB, Ensto, Microsoft Mobile,
Murata Electronics, Nokia, Planmeca,
Polar Electro, Suunto, Vacon, Vaisala…
METALS INDUSTRY
Boliden, Componenta, Kuusakoski,
Luvata, Outokumpu, Outotec,
Ovako, Sacotec, SSAB …
MECHANICAL ENGINEERING
Abloy, Cargotec, Finn-Power, Fiskars,
Glaston, Kone, Konecranes, Metso,
Meyer Turku, Normet, Oras, Patria,
Pemamek, Ponsse, Stala, Valmet,
Valtra, Wärtsilä…
INFORMATION TECHNOLOGY
Affecto, Basware, Bilot, CGI, Comptel,
Digia, Efecte, Enfo, F-Secure, Fujitsu
Finland, IBM, Innofactor, Knowit,
Microsoft, Nixu, Tieto…
CONSULTING ENGINEERING
A-Insinöörit, Citec, Elomatic, Etteplan, FCG,
Granlund, Neste Jacobs, Pöyry, Ramboll,
Rejlers, SITO, SWECO, WSP…

The Finnish Technology Industry Is Comprised of
Five Sub-Sectors
3
ELEKTRONICS AND ELECTROTECHNICAL
INDUSTRY
• Data communications equipment, electrical
machinery, medical technology
• Turnover (2019): 18.0 billion euros
• Personnel (2019): 38,700
METALS INDUSTRY
• Steel products, non-ferrous metals,
castings, metallic minerals
• Personnel (2019): 15,800
MECHANICAL ENGINEERING
• Machinery, metal products, vehicles
• Personnel (2019): 134,200
INFORMATION TECHNOLOGY
• IT services, applications and
programming
• Personnel (2019): 74,100
CONSULTING ENGINEERING
• Expertise for construction industry and
infrastructure
• Personnel (2019): 56,200
of Finland

The Technology Industry –
the Largest Export Sector in Finland
4
• Some 50 % of total exports.
• Some 310,000 employed directly in the
sector, including indirect effects 650,000
people.
• Effect on value added totaling € 57 billion,
or 28% of GDP value added.
• Bring to Finland € 18 billion tax revenue
annually.
• Investments about EUR 5.0 billion
annually in Finland.
• 70 % of private-sector R&D investment.
of Finland

Value Added to the Economy Generated by the
Technology Industry Is EUR 55 Billion, or over 28%
of GDP * (2017)
527.11.2020 Teknologiateollisuus
28.8, 53%
15.6, 29%
10.1, 18%
A total of EUR 54.5 billion
Impact on technology industry
(direct influence)
Impact on other industries
(indirect influence)
Impact on private consumption
(income effect)
*) GDP value added was EUR 193.3 billion in 2017.
Source: Economic Impact of the Technology Industry in Finland 11/2018

Technology Industry Generates nearly 650,000
Jobs in Finland (over 25% of All Employees) (2017)
304,600, 47%
225,800, 35%
114,600, 18%
A total of 644 900 employees
(direct influence)
(income effect)
10 jobs in the technology industry bring
11 jobs to the rest of the economy

Every Job in the Technology Industry Generates
almost another Job in the Services (2017)
295,100, 87%
12,200, 3%
33,100, 10%
Impact on other industries and on
private consumption: 340,300 employees
Services*
Primary production
Processing*
*) Excl. the services industries in the technology industry.

Technology Industry Generates over 18 Billion
Euros in Tax Revenue Annually in Finland (2017)
9.2, 50%
4.3, 24%
4.7, 26%
A total of EUR 18.2 billion
(direct influence)
(income effect)

Turnover of the Technology Industry in Finland
9Source: Macrobond, Statistics Finland, Technology Industries of Finland11/27/2020 Technology Industries
of Finland

10*) In addition to goods exports the sector exported services worth some 14-15 billion euros.
Source: National Board of Customs, Statistics Finland
Export of Technology Industry Goods from Finland
by Area in 2019
Total goods exports 32.5 billion euros*
North America
3.15 billion €
9.2 %
Western Europe
18.23 billion €
53.3 %
South and
Middle America
0.99 billion €
2.9 %
Central and Eastern Europe
5.94 billion €
17.4 %
Africa
0.45 billion €
1.3 %
Middle and
Central East
0.51 billion €
1.5 %
Asia
4.93 billion €
14.4 %
of Finland

Technology, Forest and Chemical Industries
Provide 81 % of Finland's Goods and Services
Exports Revenue
Goods and service exports: billion euros and the share of Finnish exports in 2017
11*) Service exports industry-specific data for the year 2017 are preliminary information.
Source: Board of Customs, Statistics Finland (National Accounts, Foreign trade in services), Federation of Finnish Technology Industries
of Finland
Technology industry,
43.6, 51%
Forest industry;
12.9; 15%
Chemical industry;
13; 15%
Other branches;
16.1; 19%

Turnover of the Industry and Technology Industry
in Finland
12Source: Macrobond, Statistics Finland11/27/2020 Technology Industries
of Finland

Turnover of the Technology Industry in Finland
13Source: Macrobond, Statistics Finland11/27/2020 Technology Industries
of Finland

Value of new orders in the technology industry* in
Finland
14Source: The Federation of Finnish Technology Industries’ order book survey’s respondent
companies, latest observation July-September 2020.
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
11,000
12,000
Combined
Export
Domestic
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Million euros, at current prices
Change: III/2020 / III,2019 III,2020 / II,2020
Export: -8 % +13 %
Domestic: -24 % -4 %
Combined: -12 % +8 %
*) Excl. metals
industry, game
industry and data
center companies
Technology Industries
of Finland
11/27/2020

Value of order books in the technology industry*
in Finland
15Source: The Federation of Finnish Technology Industries’ order book survey’s respondent
companies, latest observation 30th September 2020.
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
22,000
24,000
26,000
28,000
30,000
Export
Domestic
Change: 30.9.2020 / 30.9.2019 30.9.2020 / 30.6.2020
Export: -4 % -1 %
Domestic: -3 % -1 %
Combined: -4 % -1 %
*) Excl. metals
industry, game
industry and data
center companies
Combined
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Tender Requests* Received by the Technology
Industry Companies in Finland
16Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies, the last questionnaire in
October 2020.
-60
-50
-40
-30
-20
-10
0
10
20
30
40
Balance figure
*) ”Have you experienced a notable increase or decrease in the number of requests for tenders in recent weeks in comparison to the situation three
months ago?”. Balance figure = the number of companies receiving more requests - the number of companies receiving less requests.”
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Value of new orders in the electronics and
electrotechnical industry in Finland
17
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
6,500
7,000
7,500
Combined
Export
Domestic
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Change: III,2020 / III,2019 III,2020 / II,2020
Export: -5 % +6 %
Domestic: -4 % -10 %
Combined: -5 % +3 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent
of Finland
11/27/2020

Value of order books in the electronics and
electrotechnical industry in Finland
18
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
6,500
7,000
7,500
8,000
8,500
Export
Domestic
Change: 30.9.2020 / 30.9.2019 30.9.2020 / 30.6.2020
Export: -4 % +3 %
Domestic: -2 % -8 %
Combined: -4 % +1 %
Combined
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Value of new orders in the mechanical engineering
in Finland
19
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
6,500
7,000
Combined
Export
Domestic
Export: -12 % +27 %
Domestic: -44 % +10 %
Combined: -21 % +23 %
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Value of order books in the mechanical
engineering in Finland
20
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
22,000
Export
Domestic
Change: 30.9.2020 / 30.9.2019 30.9.2020 / 30.6.2020
Export: -4 % -2 %
Domestic: -8 % -2 %
Combined: -5 % -2 %
Combined
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Value of new orders in the consulting engineering
in Finland
21
0
20
40
60
80
100
120
140
160
180
200
220
240
260
280
300
Combined
Export
Domestic
Export: -30 % +10 %
Domestic: +5 % -22 %
Combined: -2 % -19 %
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Value of order books in the consulting engineering
in Finland
22
0
50
100
150
200
250
300
350
400
450
500
550
600
650
700
750
800
Export
Domestic
Change: 30.9.2020 / 30.9.2019 30.9.2020 / 30.6.2020
Export: -3 % -8 %
Domestic: +12 % -1 %
Combined: +10 % -2 %
Combined
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Value of new orders in the information
technology* in Finland
23
0
100
200
300
400
500
600
700
800
Combined: -1 % -14 %
*) Excl. game industry and data center
companies
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Value of Order Books in the Information
Technology* in Finland
24
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2,200
Change: 30.9.2020 / 30.9.2019 30.9.2020 / 30.6.2020
Combined: +2 % +2 %
*) Excl. game industry and data
center companies
of Finland
11/27/2020
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Technology Industry Personnel
2511/27/2020 Technology Industries of
Finland
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force survey, Macrobond
Almost 40,000 employees
affected by temporary lay-
offs 30th September 2020
30th Sep

Technology Industry Personnel Recruitment in
Finland by Quarters
26Source: The Federation of Finnish Technology Industries’ labour force survey
-4,000
-2,000
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
2014Q3 2015Q1 2015Q3 2016Q1 2016Q3 2017Q1 2017Q3 2018Q1 2018Q3 2019Q1 2019Q3 2020Q1 2020Q3
Change in the number of personnel compared to the previous quarter Number of people recruited during the quarter
of Finland
11/27/2020

Technology Industry Personnel in Finland by
Industry
Finland
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force survey, Macrobond
30th Sep

Technology Industry Personnel in Subsidiaries
Abroad by Industry
Finland
Source: The Federation of Finnish Technology Industries’ labour force survey, Macrobond

Technology Industry Personnel in Subsidiaries
Abroad by Country
2911/27/2020 Technology Industries of Finland Source: The Federation of Finnish Technology Industries’ labour force survey
Information from year 2019
China, 45,832, 15%
India, 29,658, 10%
USA, 28,391, 10%
Germany, 19,701, 7%
Poland, 18,522, 6%
Mexico, 14,365, 5%
Sweden, 14,192, 5%
France, 11,313, 4%
UK, 8,204, 3%
Russia, 7,096, 2%
Italy, 6,780, 2%
Brazil, 6,490, 2%
Canada, 5,171, 2%
Other countries, 81,921, 27%

Retirement of Technology Industry Personnel in
Finland
30
0
1000
2000
3000
4000
5000
6000
7000
8000
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Salaried employees
Blue collar employees
Individuals per year
Source: Wage inquiry of the Techonology Industries of Finland, Finnish Centre for Pensions, Statistics FinlandTechnology Industries
of Finland
11/27/2020

Retirement of Technology Industry Blue Collar
Employees in Finland
31
0
500
1000
1500
2000
2500
3000
3500
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Mechanical engineering Metals industry Electronics and electrotechnical industry
Individuals per year
Source: Wage inquiry of the Techonology Industries of Finland, Finnish Centre for Pensions, Statistics FinlandTechnology Industries
of Finland
11/27/2020
Number of individuals retiring
(estimation)
Number of individuals retired

Overview of the Situation in the Technology
Industry and Outlook for the Rest of the Year 2020
32
- Turnover in Finland totalled some EUR 83 billion in 2019. The turnover was up 6% year-on-
year. In January-August the turnover was slightly higher than last year at the same period.
- The monetary value of new orders reported between July-September 2020 was 8% higher
than in the preceding quarter, but 12% lower than in the corresponding period in 2019.
- At the end of September, the value of order books was mildly lower as at the end of June,
but 4% lower than in September 2019.
- The turnover of the technology industry decline in Finland has stopped in late summer, but
will be slightly smaller towards the end of the year than at the same time a year ago.
- At the end of September, the number of employees in Finland was 1.1 per cent lower than
last year's average. At the end of September, there were 309,400 employees, which is about
3,500 less than last year. Of the employees, almost 40,000 were covered by lay-off
arrangements at the end of September.
- Recruitment of new staff has decreased during the corona pandemic. In July-September,
there were a total of 5,500.
11/27/2020 Technology Industries of Finland

World Economic Outlook
- Finland as a Part of Global
Economy
3311/27/2020 Technology Industries of Finland

GDP Forecasts for 2020 Have Been Significantly
Reduced
34Source: Consensus Economics
-11
-10
-9
-8
-7
-6
-5
-4
-3
-2
-1
0
1
2
3
4
GDP consensus forecasts for 2020, %
Eastern Europe
Finland
Sweden
Russia
France
Germany
Italy
Forecast period
of Finland

In the Euro Area Countries, GDP Contracted more
Sharply in April-June than in Finland
35Lähde: MacrobondTechnology Industries
of Finland
11/27/2020

Finland Is Clearly Behind in the Growth of Exports
Relative to the Euro Countries
36Source: Macrobond, Eurostat11/27/2020 Technology Industries
of Finland

Exports and Private Consumption Turned Finland’s
Economic Growth Negative in January-June
37Source: Macrobond, Statistics FinlandTechnology Industries
of Finland
11/27/2020

Corona Crisis Collapsed GDP in All Countries
38Souce: MacrobondTechnology Industries
of Finland
11/27/2020

3911/27/2020 Lähde: Macrobond
In China, the Economy Contracted Sharply in
January-March 2020, but Recovered in April-June
of Finland

Purchasing Manager Indices for the Entire
Business Sector in Finland’s Most Important
Export Countries
40Source: Macrobond. Markit11/27/2020 Technology Industries
of Finland

In Finland, Industrial Production Has Withstood
Better than in Competing Countries
4111/27/2020 Source: MacrobondTechnology Industries
of Finland

In Finland, Industrial Production Has Withstood
Better than in Most Other EU Countries
4211/27/2020 Source: MacrobondTechnology Industries
of Finland

Industrial Production Is Already Recovering in
China and Globally
43Source: Macrobond, The CPB Netherlands Bureau for Economic Policy AnalysisTechnology Industries
of Finland
11/27/2020

Industrial Purchasing Managers' Indices Report a
Return to Growth in Many Countries
4427.11.2020 Teknologiateollisuus Lähde: Macrobond, Markit

Industrial Production Grew in October in All Major
Developing Countries, Except in Russia
4527.11.2020 Teknologiateollisuus Lähde: Macrobond, Markit

Exchange Rates (when the Curve Rises, the Value of
the Euro Strengthens Against the Other Currency)
46Source: Macrobond11/27/2020 Technology Industries
of Finland

47Source: Macrobond, The CPB Netherlands Bureau for Economic Policy Analysis
Corona Pandemic Affected World Trade by Force
Goods export volume
of Finland
11/27/2020

Chinese Imports Declined in the Spring but
Rebounded During the Summer and Autumn
48Source: MacrobondTechnology Industries
of Finland
11/27/2020

EU Exports to Russia Are Stagnating
49Source: MacrobondTechnology Industries
of Finland
11/27/2020

Russia’s* Share of the Technology Industry's
Finnish Exports Has Fallen to about 5 Percent
50*) Soviet Union up to 1991
Source: Finnish Customs
0
2
4
6
8
10
12
14
16
18
20
22
24
26
28
30
32
34
36
38
40
42
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020(1-8)
of Finland
11/27/2020
%

51Source: IMF (June 2020)
The Global Economy Is Forecast to Shrink by 4.4%
in 2020, but to Grow by 5.2% in 2021
GDP growth 2020/2019, %
-11
-10
-9
-8
-7
-6
-5
-4
-3
-2
-1
0
1
2
3
0 10 20 30 40 50 60 70 80 90 100
North America Japan
China
India
Restof
Europe
Russia
Brazil
Mexico
RestotLat.
America
MiddleEast
andAfrica
Kasvu keskimäärin:
-4,4 %
The width of the bar indicates the share of global GDP in 2019 (adjusted for purchasing power parity), %
Rest of
Asia
of Finland
11/27/2020

52Source: IMF (June 2020)
In the Export Market of the Technology Industry,
Demand Will Decrease by 6.5%in 2020
GDP growth 2020/2019, %
-11
-10
-9
-8
-7
-6
-5
-4
-3
-2
-1
0
1
2
3
0 10 20 30 40 50 60 70 80 90 100
North America Western Europe Japan
ChinaIndia
Restof
Europe
Russia
Brazil
Mexico
RestofLat.Am.
Middle
Eastand
Africa
Kasvu keskimäärin:
-6,5 %
The width of the bar indicates the export share of technology industry from Finland in 2019, %
Rest
Of
Asia
of Finland
11/27/2020

Finland’s Economic Growth
Relies on Exports and
Investments
53Technology Industries
of Finland
11/27/2020

Finland’s Exports Lagged behind Its Competitors
Even before the Corona Crisis
54Source: Macrobond, EurostatTechnology Industries
of Finland
11/27/2020

55Source: Macrobond, Eurostat
Central and Local Government Debt Was Already
High Before the Corona Crisis
of Finland
11/27/2020

Unlike the Competitor Countries, in Finland
Business Investment Is Still Below the Level in 2008
56Source: OECD, Economic Outlook (June 2020)
80
85
90
95
100
105
110
115
120
125
130
135
140
145
150
155
160
165
170
175
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020e 2021e
Corporate investments, at fixed prices, index 2005=100
USA
Sweden
Switzerland
Belgium
Germany
Finland
of Finland

5727.11.2020 Teknologiateollisuus Source: Statistics Finland (National Accounts), Statistics Finland (Research and Development), EK Investment Survey (June
2020)
Investment Rate in the Technology Industry in
Finland Fell after the Financial Crisis
Tangible and intangible investments in Finland
0
2
4
6
8
10
12
14
16
18
20
0
1,000
2,000
3,000
4,000
5,000
6,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019e
Tangible investments Intangible investments Investment rate, tangible
Investment rate, intangible Investment rate, combined
Investments, million euros,
at current prices
Investment rate (investments /
value added), %

Industrial Tangible and Intangible Investment* in
Finland Have Not Yet Reached the 2007-2008 Levels
58*) Including software investments.
Source: Statistics Finland (National Accounts), Confederation of Finnish Industries’ Investment Survey June 2020
0
1
2
3
4
5
6
7
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020e
Tangible investment
Intangible investment
Intangible investment (excl.
electronics industry)
Billion euros, at fixed 2015 prices
of Finland

Total Industrial Investment in Finland Is Now at
Around the Level of Capital Consumption
59*) Including software investments.
Source: Statistics Finland (National Accounts), Confederation of Finnish Industries’ Investment Survey June 2020
0
1
2
3
4
5
6
7
8
9
10
11
12
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020e
Tangible and intangible
investment*
Consumption of Fixed
Capital
of Finland

Tangible Investments by Industry in Finland Are
Now at the Level of the Consumption of Capital
60Source: Statistics Finland (National Accounts), Confederation of Finnish Industries’ Investment Survey June 2020
0
1
2
3
4
5
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020e
Tangible investment
Consumption of tangible
capital
of Finland

Industrial Production Capital in Finland Has
Disappeared Significantly, Especially after 2008
61Information on consumption of tangible capital is at 2010 prices.
Source: Statistics Finland (National Accounts)
0
5
10
15
20
25
30
35
40
45
50
55
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Cumulative consumption
of tangible capital
Cumulative tangible
investment
of Finland
=6,4 bill. €

Industrial Tangible Investment Growth in Finland
Has Lagged behind that of Competitors
62Source: Eurostat (National Accounts), Confederation of Finnish Industries’ investment survey, January 2020
60
70
80
90
100
110
120
130
140
150
160
170
180
Hungary
Poland
Netherlands
Austria
Germany
Czech
Republic
Sweden
Belgium
Finland
Billion euros, at fixed 2015 prices, index 2005=100
of Finland

Investment Rate in Industrial Tangible
Investments Is at a Low Level in Finland
63Source: Eurostat (National Accounts)
6
8
10
12
14
16
18
20
22
24
26
28
30
32
34
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Hungary
Poland
Netherlands
Austria
Germany
Czech
Republic
Sweden
Belgium
Finland
Tangible investments / value added, %
of Finland

Industrial Intangible Investments * in Finland
Have almost Halved since 2005
64*) Intangible investments include research and development and software investments etc.
Source: Eurostat (National Accounts), Confederation of Finnish Industries’ investment survey, January 2020
40
60
80
100
120
140
160
180
200
220
240
260
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019e 2020e
Hungary
Poland
Netherlands
Austria
Germany
Czech Republic
Sweden
Belgium
Finland, excl.
electronics industry
Finland
Billion euros, at fixed 2015 prices,
index 2005=100
of Finland

Investment Rate of Industrial Intangible
Investments* Has Dropped Significantly in Finland
65*) Intangible investments include research and development and software investments.
Source: Eurostat (National Accounts)
0
2
4
6
8
10
12
14
16
18
20
22
24
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Hungary
Poland
Netherlands
Austria
Germany
Czech Republic
Sweden
Belgium
Finland, excl.
electronics industry
Finland
Intangible investments / value added, %
of Finland

Investments and productivity* are Decisive for
Finland’s Success
Finland
*) Productivity is measured as real value added per hours worked. When productivity grows
(the curve rises) value added grows more than hours worked.
Source: Statistics Finland

67Latest information April-June 2020.
Source: Eurostat: Quarterly National Accounts
Finland’s GDP Productivity Has Lagged Behind Other
EU and Euro Countries
GDP at fixed prices / hours worked
82
84
86
88
90
92
94
96
98
100
102
104
106
108
110
112
114
Euro countries
Sweden
Finland
Germany
Index 2008=100 (the year before the collapse of Finnish industrial production capacity)
Finland

68Latest information April-June 2020.
Source: Eurostat: Quarterly National Accounts
In Industrial Productivity, Finland Is Still Behind
the EU and Eurozone Average
Industrial value added at fixed prices / hours worked
60
65
70
75
80
85
90
95
100
105
110
115
120
125
130
135
Euro countries
Sweden
Finland
Germany
2008=100 (the year before the collapse of Finnish industrial production capacity)
Finland

69Lates information April-June 2020.
Source: Eurostat
The Investment Rate of Companies in Finland Is
Clearly Lower than the EU Average
18
20
22
24
26
28
30
Sweden
Autsria
Belgium
Denmark
Finland
Corporate fixed investment compared to value added, % (excl. financial sector)
of Finland

70
There Is Still Room for Improvement in Finland’s
Cost Competitiveness
Unit labour costs in the whole economy = labour costs / productivity, including the influence of effective
exchange rates
94
96
98
100
102
104
106
108
110
112
114
2000=100
2005=100
2008=100
Finland’s price
and cost
competitiveness
declines
Finland’s price
and cost
competitiveness
improves
of Finland
*) In the ECB Harmonised Competitiveness Index, the average effective exchange rate of each country is calculated vis-à-vis 38
main trade partners, as well as the development of unit labour costs for the total economy.
Latest information April-June 2020. Source: European Central Bank
00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20

Member Companies of the
Federation of Finnish
of Finland

The Federation’s Member Companies 2019
72
250–499 employees
72,755
38%
32,554
17%
27,555
14%
59,435
31%
1,449
90.1%
86
5.7%
38
2.5% 24
1.8%
Number of enterprises / 1,608 Number of personnel / 192,299
1–249 employees 500–999 employees
1000– employees
of Finland
11/27/2020

The Federation’s SME Member Companies 2019
73
482
33.3%
483
31.5%
288
19.8%
209
14.4%
Number of enterprises / 1,449 Number of personnel / 72,755
5,140
7.1%
15,832
21.8%
20,092
27.6%
31,691
43.5%
1–19 employees
20–49 employees
50–99 employees
100–249 employees
of Finland

Operating Profit in the Member Companies of
Technology Industries of Finland in 2019
Operating profit-% = operating result / turnover * 100 (before taxes and financial income
and expenses)
74Source: Statistics Finland
-30
-25
-20
-15
-10
-5
0
5
10
15
20
25
30
(Median: 4.6%)
Good (26%)
Satisfactory (23%)
Weak (29 %)
Unprofitable
(21 %)
of Finland
Companies in random order

Net Profit in the Member Companies of Technology
Industries of Finland in 2019
Net profit -% = net profit / turnover * 100 (after tax and financial income and expenses)
75
-30
-25
-20
-15
-10
-5
0
5
10
15
20
25
30
(Median: 3.9%)
Unprofitable (24%)
Good (21%)
Satisfactory (21%)
Weak (34%)
Source: Statistics Finland11/27/2020 Technology Industries
of Finland

Return on Assets in the Member Companies of
Return on assets -% = (net income + financial expenses + taxes) / (capital invested in the
financial year) * 100
76
-30
-25
-20
-15
-10
-5
0
5
10
15
20
25
30
(Median: 11.0%)
Good (42%)
Satisfactory (11%)
Mediocre (28%)
Weak (19%)
of Finland

Equity Ratio in the Member Companies of
Equity ratio -% = (total equity + total appropriations accrued) / adjusted balance sheet * 100
77
0
5
10
15
20
25
30
35
40
45
50
55
60
65
70
75
80
85
90
95
100
(Median: 42.6%)
Good (53%)
Satisfactory (24%)
Weak (23%)
of Finland

Finnish Tech Industry Outlook

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