The Finnish technology industry is comprised of five sub-sectors: electronics/electrotechnical, metals, mechanical engineering, consulting engineering, and information technology. It accounts for 50% of Finnish exports, 75% of private R&D investment, and employs 30% of Finland's workforce. While the industry saw growth in 2014, new orders in early 2015 were down 9% YoY and turnover has not returned to pre-crisis levels, indicating Finland is still undergoing structural economic changes.

1. Technology Industry /
Finnish Economic
Situation and Outlook
June 2015

2. • 50 % of total Finnish exports.
• 75 % of private-sector
R&D investment.
• Almost 270,000 employed directly in
the sector, 700,000 employed in total,
equalling about 30% of the entire
Finnish labour force.
• The Federation of Finnish Technology
Industries has over 1,600 member
companies.
2
The Technology Industry –
the Largest Export Sector in Finland
8.6.2015

3. Mechanical Engineering
Abloy, Cargotec, Finn-Power, Fiskars,
Glaston, Kone, Konecranes, Metso,
Meyer Turku, Normet, Oras, Patria,
Pemamek, Ponsse, Stala, Valmet, Valtra,
Wärtsilä…
Electronics and
Electrotechnical Industry
ABB, Ensto, Microsoft Mobile,
Murata Electronics, Nokia,
Planmeca, Polar Electro, Suunto,
Vacon, Vaisala…
Information Technology
Affecto, Basware, Bilot, CGI,
Codebakers, Comptel, Digia,
Efecte, Enfo, F-Secure, Fujitsu
Finland, IBM, Innofactor, Knowit,
Microsoft, Nixu, Tieto…
Metals Industry
Boliden, Componenta,
Kuusakoski, Luvata, Norilsk
Nickel, Outokumpu, Outotec,
Ovako, Sacotec, SSAB …
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
8.6.20153

4. The Finnish Technology Industry is Comprised of
Five Sub-Sectors
Electronics and
Electrotechnical Industry
• Data communications equipment,
electrical machinery, medical technology
products
• Turnover (2014): 15.1 billion euros
• Personnel (2014): 42 300
Metals Industry
• Steel products, non-ferrous
metals, castings
• Turnover (2014): 9.2 billion euros
• Personnel (2014): 15 300
Mechanical Engineering
• Machinery, metal products,
vehicles
• Turnover (2014): 27.2 billion euros
• Personnel (2014): 118 900s
Consulting Engineering
• Expertise for construction industry
and infrastructure
• Turnover (2014): 5.0 billion euros
• Personnel (2014): 46 300
Information Technology
• IT services, applications
and programming
• Turnover (2014): 10.0 billion euros
• Personnel (2014): 53 000
8.6.20154

5. 8.6.20155
Turnover of the Technology Industry in Finland
Source: Macrobond, Statistics Finland

6. 8.6.20156
Export of Technology Industry Goods from
Finland by Area in 2014
Total goods exports 26.2 billion euros*
North America
2.6 billion €
9.8%
Western Europe
13.1 billion €
50.1%
Middle and
Central East
0.5 billion €
2.1%
Asia
4.1 billion €
15.8%
Africa
0.5 billion €
1.8%
South and Middle America
0.9 billion €
3.3%
Central and Eastern Europe
4.5 billion €
17.1%
*) In addition to goods exports the sector exports services worth about 11 billion euros.
Source: National Board of Customs, Statistics Finland

7. 8.6.20157
Turnover of the Industry and Technology
Industry in Finland
Source: Macrobond, Statistics Finland

8. 8.6.20158
Turnover of the Technology Industry in Finland
Source: Macrobond, Statistics Finland

9. 8.6.20159
Value of New Orders in the Technology Industry* in
Finland
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
Million euros, at current prices
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-Mach 2015
*) Excluding metals industry
and game industry
companies.
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Change: I,2015 / I,2014 I,2015 / IV,2014
Export: -12% -19%
Domestic: -5% +2%
Combined: -9% -14%

10. 8.6.201510
Value of Order Books in the Technology Industry* in
Finland
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
Export
Domestic
Million euros, at current prices
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 31.3.2015
*) Excluding metals industry
and game industry
companies.
Combined
Change: 31.3.2015 / 31.3.2014 31.3.2015 / 31.12.2014
Export: +9% -4%
Domestic: +30% +6%
Combined: +15% - 1%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

11. 8.6.201511
Value of New Orders in the Electronics and
Electrotechnical Industry in Finland
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
Million euros, at current prices
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Change: I,2015 / I,2014 I,2015 / IV,2014
Export: -14% -24%
Domestic: +25% +26%
Combined: -8% -18%
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-March 2015

12. 8.6.201512
Value of Order Books in the Electronics and
Electrotechnical Industry in Finland
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
Combined
Million euros, at current prices
Change: 31.3.2015 / 31.3.2014 31.3.2015 / 31.12.2014
Export: -1% -18%
Domestic: +53% +33%
Combined: +6% -11%
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 31.3.2015
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

13. 8.6.201513
Value on New Orders in the Mechanical Engineering
in Finland
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
Combined
Export
Domestic
Million euros, at current prices
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Change: I,2015 / I,2014 I,2015 / IV,2014
Export: - 9% -12%
Domestic: -9% -1%
Combined: -9% -10%
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-March 2015

14. 8.6.201514
Value of Order Books in the Mechanical Engineering
in Finland
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
13,000
14,000
15,000
Export
Domestic
Combined
Million euros, at current prices
Change: 31.3.2015 / 31.3.2014 31.3.2015 / 31.12.2014
Export: +14% +3%
Domestic: +45% +4%
Combined: +20% +3%
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 31.3.2015
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

15. 8.6.201515
Value on New Orders in the Consulting Engineering
in Finland
0
20
40
60
80
100
120
140
160
180
200
220
240
260
280
300
320
Combined
Export
Domestic
Million euros, at current prices
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Change: I,2015 / I,2014 I,2015 / IV,2014
Export: -13% -28%
Domestic: +4% -12%
Combined: +2% -14%
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-March 2015

16. 8.6.201516
Value of Order Books in the Consulting Engineering
in Finland
0
50
100
150
200
250
300
350
400
450
500
550
Export
Domestic
Combined
Million euros, at current prices
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 31.3.2015
Change: 31.3.2015 / 31.3.2014 31.3.2015 / 31.12.2014
Export: -5% -9%
Domestic: +15% +4%
Combined: +12% +2%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

17. 8.6.201517
Value on New Orders in the Information Technology
in Finland
0
50
100
150
200
250
300
350
400
450
500
550
600
650
700
750
800
850
Million euros, at current prices
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Change: I,2015 / I,2014 I,2015 / IV,2014
Combined: -18% -11%
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-March 2015
*) Excl. game
industry companies

18. 8.6.201518
Value of Order Books in the Information Technology
in Finland
0
100
200
300
400
500
600
700
800
900
1,000
1,100
1,200
1,300
1,400
1,500
1,600
1,700
Million euros, at current prices
2007 2008 2009 2010 2011 2012 2013 2014 2015
Change: 31.3.2015 / 31.3.2014 31.3.2015 / 31.12.2014
Combined: +7% 0%
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 31.3.2015
*) Excl. game
industry companies

19. Source: The Federation of Finnish Technology Industries’ order book survey,
latest information April 2015.
“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.
-60
-50
-40
-30
-20
-10
0
10
20
30
40
Balance figure
8.6.201519
Tender Requests* Received by Technology Industry
Companies in Finland
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

20. 150,000
170,000
190,000
210,000
230,000
250,000
270,000
290,000
310,000
330,000
350,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
(31.3)
Personnel in Finland Personnel in subsidiaries abroad
8.6.201520
Personnel in the Technology Industry
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force survey
Some 15 000 of employees
affected by temporary or part-
time lay-offs 31.3.2015

21. 0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
(31.3)Electronics and Electrotechnical Industry Mechanical engineering industry
Metals industry Consulting engineering
Information technology
8.6.201521
Technology Industry Personnel in Finland by Branch
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force survey

22. 0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Electronics and Electrotechnical Industry Mechanical engineering industry
Metals industry Consulting engineering
Information technology
8.6.201522
Technology Industry Personnel in Subsidiaries
Abroad by Branch
Source: The Federation of Finnish Technology Industries’ labour force survey

23. Retirement of Technology Industry Personnel
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Number of individuals retired Number of individuals retiring (estimation)
Source: Wage inquiry of the Federation of Finnish Technology Industries,
Finnish Centre for Pensions, Statistics Finland
Individuals per year
Salaried employees
Blue collar employees
8.6.201523

24. Retirement of Technology Industry Blue Collar
Employees
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
Source: Wage inquiry of the Federation of Finnish Technology Industries, Finnish
Centre for Pensions, Statistics Finland
Individuals per year
8.6.201524

25.  - Finland is in the grip of structural change. Development remains uneven between
companies.
 - Turnover in Finland in 2014 increased slightly compared to 2013. Turnover totalled
EUR 66 billion. In the pre-crisis year 2008 it was EUR 86 billion.
 - The monetary value of new orders reported between January-March 2014 was 9 %
lower than in the corresponding period in 2014, and 14% lower than in the preceding
quarter.
 - At the end of March, the value of order books was 15% higher year-on-year, but
slightly lower the value reported at the end of December.
 - The turnover of technology industry companies in the spring of 2015 is expected to be
slightly higher than in the corresponding period year earlier.
 - Since 2008, personnel numbers in Finland have shrunk by 53,000 employees, totalling
273,000 at the end of March 2015.
Situational Overview and Outlook
8.6.201525

26. Divergence in the
Development of Export
Markets
8.6.201526

27. Industrial Production Volume
Source: Macrobond
8.6.201527

28. Industrial Production Volume in EU Countries
Source: Macrobond
8.6.201528

29. Weak Growth in Manufacturing Industry in
Eurozone in Early 2015
Purchase Managers’ Index (PMI), 50 = no change from previous month
Latest information May 2015.
Source: Markit
8.6.201529

30. Russian Economy is in Negative Circle
Purchase Managers’ Index (PMI) in manufacturing industry in Russia
50 = no change from previous month
Latest information May 2015.
Source: Markit
8.6.201530

31. Global Economy is Expected to Grow by 3.5% in
2015
GDP growth in 2015, %
Source: IMF (January 2014)
-3
-2
-1
0
1
2
3
4
5
6
7
8
9
10
0 10 20 30 40 50 60 70 80 90 100
North America
Western Europe
Japan
China
India
Rest of
Asia
RestofEastern
Europe
Russia
Brazil
Mexico
RestofLatinAm.
MiddleEastandAfrica
The width of the bar indicates the share of global GDP in 2014 (adjusted for purchasing power parity), %.
Average growth: +3.5%
8.6.201531

32. Export Demand for Technology Industry in
Finland Will Grow by 2.0 % in 2015
GDP growth in 2015, %
Source: IMF (January 2015), Board of Customs
-3
-2
-1
0
1
2
3
4
5
6
7
8
9
10
0 10 20 30 40 50 60 70 80 90 100
North
America
Western Europe Japan
China
India
Rest of
Asia
RestofEastern
Europe
Russia
Brazil
Mexico
RestofLatinAm.
MiddleEastandAfrica
The width of the bar indicates the export share of technology industry from Finland in 2013, %
Average growth: +2.0%
8.6.201532

33. Exports from EU Countries to Russia
is Falling
Source: Macrobond
8.6.201533

34. 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
2015e
Russia’s Share of Technology Industry Exports Will
Decline Again to the Level of Approximately Five Per
Cent
%
*) Soviet Union up to 1991.
Source: Finnish Customs
8.6.201534

35. Breakdown of World Industrial Production
0
5
10
15
20
25
30
35
40
45
50
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Asia
North America
Europe
Purchasing power parity adjusted shares.
Source: Maddison (Historical Statistics), IMF and ETLA
%
8.6.201535

36. Industrial Production Development by Year
Source: Macrobond
8.6.201536

37. The Big Challenge for
Finland after 2008
8.6.201537

38. Finnish Exports up to EUR 30 Billion Short of
Annual Target Level
Source: Macronond, Statistics Finland / National Accounts8.6.201538

39. Finnish Exports Lagging Behind Competitors
Source: Macrobond, Eurostat8.6.201539

40. The Share of Industry in GDP in Finland 1900-2013
0%
5%
10%
15%
20%
25%
30%
35%
1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Industry* Industry + service sectors in the technology industry
*) During 1900-1974 industry covers also mines, energy, water and refuse collection sectors.
Source: Statistics Finland / National Accounts
8.6.201540

41. 12.6.201541
55
60
65
70
75
80
85
90
95
100
70
75
80
85
90
95
100
105
110
115
120
125
Industrial
production ability
(production with
capacity in full
use), left. Scale
Industrial
production
(2008=100), left
scale
Capacity utilization
rate, %, right scale
-22 %
2008 2009 2010 2011 2012 2013 2014 2015
-21 %
Source: Statistics Finland / National Accounts, Industrial volume index
Finland’s Industrial Production Will not Regain the
Level of 2008 with the Present Production Capacity
Finland’s production capasity has decreased over 20 %

42. Growth of Public Debt and Tax Rate Out of Control
Increased cost burden requires cuts to public sector
Source: Macrobond, Statistics Finland
8.6.201542

43. 0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014e
Industry Technology industry
Industrial Investments Should be Increased
Industrial fixed and R&D investments in Finland
Source: Statistics Finland, Confederation of Finnish Industries’
Investment Survey (June 2014)
Million euros, at current prices
8.6.201543

44. Upswing of Investments Required Finland
80
85
90
95
100
105
110
115
120
125
130
135
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014e 2015e
USA
The
Netherlands
Switzerland
Sweden
Germany
Finland
Source: OECD, Economic Outlook 2014
Index, 2005=100
8.6.201544

45. 95
100
105
110
115
120
125
130
135
140
145
150
155
160
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Manufacturing industry
Technology industry
National economy
Turning Point of Productivity* Development in Finland
After 2008 Finland has lost considerable volume production in electronics, forest and
machinery industries**
Source: Statistics Finland / National Accounts
*) Productivity is measured as real value added per hours worked. When productivity grows (the curve rises)
value added grows more than hours worked.
Value added = turnover – purchasing of materials and services
Value added = labour costs + rents + depreciations + profits
**) The structure of current
industry does not enable the
similar productivity development
as during the years 2000-2008
8.6.201545
Index, 2000=100

46. 90
95
100
105
110
115
120
Compared to Belgium Compared to Germany Compared to Spain
Compared to Italy Compared to the Netherlands Compared to Austria
Compared to Finland
*) In the ECB Harmonised Competitiveness Index, the average effective exchange rate of each country is
calculated vis-à-vis 20 to 30 main trade partners, as well as the development of unit labour costs for the total
economy.
Latest information IV/2014. Source: European Central Bank
Finland’s cost
Competitiveness
declines
2005,I =100
Finland’s cost
Competitiveness
improves
Unit Labour Costs at the National Economy Level
Unit labour costs = labour costs / productivity, including the influence of effective
exchange rates
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
8.6.201546

47.  Support the renewal of the industry
 Taxes should support growth and investment in Finland
 Support decision making in companies related to compensation and
working time
 No new European nor national burdens on companies, which are
deteriorating the competitiveness
What should be done?
8.6.201547

48.  Global Structural Change Set to Continue Apace
– Industrial production and services will relocate to rapidly developing economic areas
– Strong growth, large markets, cheap labour and increasing expertise will increase the
attractiveness of these regions.
 Competition over Skills and Raw Materials Set to Increase
– Due to an increase in retirement, the sector’s annual recruitment need in Finland will rise
considerably in the coming years.
– The availability of reasonably-priced energy also threatens to become an investment
bottleneck in Finland
 Combating Climate Change
– A challenge as costs are set to grow faster than in competitor countries
– An opportunity for new environmental and energy technologies
Long-Term Outlook and Challenges
8.6.201548

49. The Federation of Finnish
Technology Industries
8.6.201549

50. The Federation’s Member Companies 2013
50
70,646
38%
26,860
14%
31,468
17%
57,749
31%
1,463
91%
80
5%
46
3%
23
1%
Number of enteprises / 1 612 Number of personnel / 186 723
1–249 employees
250–499 employees
500–999 employees
1000– employees
Source: The Federation of Finnish Technology industries8.6.2015

51. 51
The Federation’s SME Member Companies 2013
514
35%
475
33%
265
18%
209
14%
Number of enterprises
/ 1 463
Number of personnel / 70 646
1–19 employees
20–49 employees
50–99 employees
100–249 employees
5,139
7%
14,947
21%
18,814
27%
31,746
45%
Source: The Federation of Finnish Technology industries
8.6.2015