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Biggest unemployment fund says benefit claims rising

Every employee pays for income-linked unemployment benefits, but only members of unemployment funds receive them.

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Image: Henrietta Hassinen / Yle
  • Yle News

Finland's biggest general unemployment fund, YTK, reports that benefit applications have risen more than 20 percent compared to the same time last year.

YTK said it received 49,005 daily allowance applications over the first three weeks of January, compared to 40,013 during the same period last year.

On Thursday YTK reported that the jobless rate among its members was 6.6 percent in December, remaining unchanged since the previous month.

It, however, said that the pace of new claims was accelerating.

Labour forecasts predict that unemployment will rise in Finland, with job losses concentrated in the construction sector.

More companies filed for bankruptcy last year than at any time this millennium. At the same time, almost 15,000 jobs disappeared.

A two-tier system

In Finland, jobseekers belong to two groups: those who receive less than a thousand euros a month in basic unemployment benefits and labour market support, and those who get hundreds — or thousands — of euros more each month because their benefits are based on earned income.

Every employee pays for income-linked unemployment benefits, but only members of unemployment funds receive them.

Unemployment funds are run by trade unions and other organisations, and workers can choose a fund that does not require membership of a union. It is estimated that around 15 percent of the Finnish workforce is, for one reason or another, not a member of these funds.

The largest part of the cost of income-linked unemployment benefits is paid out of compulsory unemployment insurance payments which come out of every pay packet in Finland and are paid by both the employee and employer — regardless of whether or not the employee belongs to an unemployment fund.

Qualifying for income-linked benefits requires being employed over the past six months while paying unemployment fund dues during the previous 28 months. Summer work, part-time jobs and short stints in the workforce can all count towards the qualifying period.

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