Finnish economists: Temporary wage cut could help immigrants find jobs

A line outside an office of the Finnish Immigration Service (Migri) in Helsinki. Photo: Vesa Moilanen/Lehtikuva

 

A temporary wage cut could boost the employment prospects of immigrants who are still adjusting to life in Finland, according to the majority a 50-member panel of economists appointed by the Finnish Business and Policy Forum (EVA).

EVA established the panel late last year to aggregate the views of economists on a number of topical economic issues in Finland.

The economists were asked, for example, to indicate their agreement or disagreement with the statement that the integration of immigrants should be promoted by allowing the payment of wages below the minimum wage rates prescribed in collective bargaining agreements for a fixed period of time.

Over 70 per cent of the 40 economists who voiced their opinion on the issue said they agreed with the statement. Fewer than one-fifth (23%) of respondents contrastively said they disagreed with the statement, while five per cent refrained from commenting on the issue altogether.

Among the economists who agreed with the statement were Bengt Holmström, a professor of economy at the Massachusetts Institute of Technology and a Nobel Laureate in Economics, and Markus Jäntti, a professor of economics at Stockholm University.

The economists were also asked whether or not they believe the financial policy decisions made in drafting next year’s budget are appropriate in light of the current economic situation in Finland.

The question divided opinion among the economists: 29 per cent of the 38 economists who voiced their opinion on the issue indicated that they consider the policy decisions appropriate and 45 per cent that they consider the decisions inappropriate.

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