Image: Emmi Korhonen / Lehtikuva

The birth rate and household disposable incomes have dropped more in Finland than in any of the other four Nordic countries, according to a fresh study. Disposable income has fallen in nearly half of Finland's municipalities, bucking the Nordic trend.

Meanwhile Finland has surpassed neighbouring Sweden as the Nordic nation with the oldest population. It also has the region's lowest birth rate and the smallest share of foreign-born residents.

Those findings are from the State of the Nordic Region 2020 report, published by the Nordic Council of Ministers on Tuesday. It was carried out by Nordregio, a Stockholm think-tank set up by the Council. Besides Finland, the council represents Denmark, Iceland, Norway and Sweden as well as the Danish territories of Greenland and the Faroe Islands, and the autonomous Finnish province of Åland.

According to the study, Sweden has the highest foreign-born proportion of the population, 19 percent last year compared to nine percent two decades ago. Finland has the lowest share, seven percent in 2019, up from just 1.3 percent in 1990.





Birth rate plunging

Finland's birth rate has been in decline since 1990, when the average woman had 1.9 children. That has fallen to 1.4.

Last year Finland's total fertility rate was the lowest ever recorded in the Nordic countries, says Research Professor Mika Gissler from the National Institute for Health and Welfare (THL).

"If you look at the surveys, there is an increasing number of young people who say that they do not want to have children at all. This suggests that these figures will remain low in Finland in the future. In the past, voluntary childlessness has been quite rare in all the Nordic countries," Gissler says.

Immigrant employment and integration key

Gissler says that Finland differs from its Scandinavian neighbours in that it has more childless people and also bigger families. As he sees it, this reflects cultural changes that are not readily affected by political decisions.

At the moment, the number of people dying is on the decline and life expectancy is rising. As a result, Finland will have more elderly people who will need care and services.

"And if we have fewer and fewer young people, immigration is the only way that we'll be able to offer services and benefits at the same rate as now. That depends on immigrants becoming employed and integrating into our society," says Gissler.

Opening new daycare centres or raising child allowances will not significantly impact the birth rate, he argues, pointing out that higher child benefits generally only play a role when parents are considering whether to have a third or fourth child.

"Entitlements for families with children have to be the kind that encourage them to have children, or at least don't hinder it," Gissler says.

South Savo on the decline

According to the report, the average disposable income dropped in nearly half of Finland's municipalities between 2011 and 2017. During the same period it rose in nearly all municipalities in the other Nordic states.

This is largely attributable to the protracted recession of the 2010s and internal migration. The Nordics' worst-hit region in this regard was South Savo in eastern Finland. Besides the highest emigration rate, it also had the poorest economic development and the highest old-age dependency ratio.

On the other hand the Helsinki-Uusimaa region in southern Finland had the country's most positive statistics, but still lagged slightly behind the other Nordic capitals.