Unemployment benefits cost drops further in 2022

The good employment situation of recent years has clearly reduced unemployment benefits spending, according to the national social insurance institution-Kela.

Expenditure on unemployment benefits amounted to €3,684 million in 2022. Unemployment funds accounted for a total of €1,840 million and Kela for €1,844 million.

Unemployment benefits paid by Kela include the basic unemployment allowance and the labour market subsidy.

In 2022, expenditure on unemployment benefits declined sharply. Benefit payments were 21 per cent lower than in the previous year. Earnings-related benefit expenditure decreased by approximately one fourth and basic unemployment benefit expenditure by approximately 14 per cent in comparison to 2021.

When adjusted to 2022 prices, the spending on unemployment benefits last year was at its lowest since 2008.

At the end of 2022, nine per cent of the population aged 17 to 64 in Finland received unemployment benefits, totalling at 300,596 people. At the end of 2022, there were 27,500 fewer recipients of unemployment benefits than at the end of the previous year.

The number of recipients of earnings-related unemployment allowance at the end of 2022 was 107,723, or 19,387 less than one year earlier. Men accounted for 52 percent of the recipients at the end of the year. Nine percent of the recipients were under the age of 25 years and 23 percent were aged 50 years or over.

At the end of 2022, the recipients of basic unemployment allowance numbered 28,457. The number of recipients decreased by 6,543 from the previous year. Women represented 48 percent of those receiving basic unemployment allowance at the end of the year. Fourteen percent of the recipients were under the age of 25 years and 24 percent were aged 50 years or over.

The number of recipients of the labour market subsidy at the end of 2022 was 162,745, or 1,745 less than one year earlier. Forty-seven percent of the recipients of labour market subsidy were women. Nine percent of the recipients were under the age of 25 years and 23 percent were aged 50 years or over.

"As the employment situation improves, it is easier for those receiving basic unemployment allowance or earnings-related unemployment benefits to find jobs, because their periods of unemployment will have been shorter. On the other hand, among the recipients of the labour market subsidy there are those who have been unemployed for longer, as well as those who have no work experience. For those people, finding work may be more difficult," says Laura Peutere, a Senior Researcher of Kela.

Labour market subsidy for the self-employed was paid to 14,602 persons, 17,790 less than in 2021. The change is explained by certain temporary legislative changes due to the COVID-19 pandemic ending on 28 February 2022, after which self-employed persons have been eligible for unemployment benefits from Kela or unemployment funds only if their self-employment ends entirely.

The percentage of population receiving unemployment benefits varied by municipality between 3 and 17. The highest rates of benefit receipt were seen in Eastern Finland.