Finland applies for EU aid to speed up re-employment of terminated car and paper industry workers

The Ministry of Economic Affairs and Employment has submitted two applications to the European Commission to qualify for support from the European Globalisation Adjustment Fund (EGF). The support aims to help redundant workers find new jobs through learning of new skills and individual and locally targeted employment services.

Funding from the EGF can be used to provide e.g. continuing education and retraining, career and job search guidance, entrepreneurship coaching and other services promoting employment. Finland’s aid applications concern the widespread redundancies in the automotive and paper industries caused by structural changes and weak market demand in these sectors. 

“The structural changes in the car and paper industry have an impact on many people. With the support, we can help those made redundant by offering them concrete assistance and finding new uses for their skills and competences in this difficult situation,” says Minister of Economic Affairs Sakari Puisto.

“We are taking a look at all possible ways to support people in this challenging situation. That is why we should make use of the European Globalisation Adjustment Fund too. Hopefully, the Commission will make a decision in our favour so that the aid can reach those affected quickly. The support would make it easier for terminated workers to transition to new jobs and prevent their prolonged unemployment,” says Minister of Employment Matias Marttinen.

Automotive industry: Valmet Automotive

The EGF application concerning the car industry relates to workers made redundant by Valmet Automotive. The redundancies have had an effect on the company’s car factory in Uusikaupunki and form a key part of the application.

The decline in Valmet Automotive’s production and order book has also impacted other companies in the sector, resulting in redundancies and termination of fixed-term employment contracts. In addition to the workers made redundant by Valmet Automotive, the application therefore also covers those terminated by companies indirectly affected by the structural change in the automotive industry. In total, the application concerns 260 redundant workers.

The terminations are driven by a prolonged economic weakness in the European car industry. Fluctuating demand for electric cars, rising costs and a volatile market environment have reduced employment in the contract manufacturing for cars and its value chain.

Paper industry: South Karelia and the Lohja region

The EGF application for the paper industry covers the regions of South Karelia and Lohja, where a number of forest and paper industry companies have reduced their workforce considerably. The application relates to the redundancies carried out by UPM, Stora Enso, Metsä Group and Sappi Kirkniemi and seeks support for approximately 350 people. 

In South Karelia, the redundancies relate to the permanent closure of paper mills as well as more efficient production and cost savings. In the Lohja region, the reduction in workforce has been caused by the shutdown of one paper machine. The application therefore covers redundant workers in several companies, who have all been affected by falling labour demand due to the paper industry restructuring.

The terminations are a result of a long-term and structural decline in the demand for print and magazine paper, which has been accelerated by digitalisation and changes in consumer habits. 

Inquiries:
Teresa Salminen, Special Adviser to the Minister, tel. +358 295 047 318 (questions to the Minister of Employment) 
Lotta Laitinen, Special Adviser to the Minister, tel. +358 295 049 058 (questions to the Minister of Economic Affairs)
Johanna Slaney, Senior Specialist, Ministry of Economic Affairs and Employment, tel. +358 295 047 017

The Ministry’s email addresses are in the format [email protected]