The national unemployment rate rose to 10.2 percent in the second quarter, far above the EU average of about 6 percent.

HELSINKI, Sept. 26 (Xinhua) -- White-collar unemployment in Finland has surged to a record high, underscoring strains in the labour market as overall joblessness climbed above 10 percent, the highest since 2009, according to official data and union officials.

Statistics Finland said nearly 340,000 people were registered as unemployed jobseekers at the end of July. Among them, nearly 67,000 held an academic degree -- over 9,000 more than a year earlier. The national unemployment rate rose to 10.2 percent in the second quarter, far above the European Union (EU) average of about 6 percent.

"This is the highest number of white-collar unemployed ever in Finland, and it is still growing," said Pasi Sorjonen, research director at the Confederation of Unions for Professional and Managerial Staff, which represents professional workers.

SECTOR DOWNTURN SPREADS

Sorjonen warned that professional job losses often signal wider economic weakness. "When new initiatives are paused, planners and experts are hit first. Routine work remains, but new creation does not," he told Finnish business daily Kauppalehti.

The first signs emerged in the construction sector, which was hurt by the fallout from the Russia-Ukraine conflict that began in 2022 and by soaring costs. "Architects and engineers were the first to lose work," Sorjonen said.

The slowdown later spread to information and communications technology (ICT) -- encompassing software, telecoms and digital services -- as companies postponed projects. More recently, commercial and retail sectors have also been affected.

Economists had debated whether white-collar unemployment would surpass the peaks of the COVID-19 pandemic. Sorjonen said those levels, as well as the highs of 2015-2016, have now been exceeded, calling the development a "sad surprise."

SAFETY NETS AND NEW LIMITS

Finland's unemployment insurance system cushions some of the blow. Benefits are linked to previous salaries rather than flat-rate allowances, meaning many professionals receive more than half their former income for 300 to 500 working days. Employers can also furlough staff while workers draw benefits.

However, non-EU temporary workers now face stricter rules introduced this summer. They must find a new job within three to six months or risk losing their residence permits. Employers are required to notify immigration authorities when foreign staff are laid off, adding uncertainty for international professionals.

The new restrictions come as the government promotes Finland abroad with the slogan "balance between private life and work ambition." Observers say the safety-net message appeals to global talent, but critics argue the tougher rules undercut the campaign's promise.

STUDENTS ANXIOUS ABOUT JOBS

Concerns are also rising among students. "Not everyone can even secure internships," said Leena Tuuttila, a team leader at student mental-health group Nyyti, in an interview with national broadcaster Yle.

She noted that while graduates in generalist fields have long faced uncertainty, even technical students are now struggling to find work. Many students say today's job prospects differ starkly from when they began their degrees, and recent limits on switching majors have left them less able to pivot.

BLEAK OUTLOOK

The Ministry of Finance, in its autumn forecast, said Finland's economy will emerge slowly from recession. It expects GDP growth of 1 percent this year, rising to 1.4 percent in 2026 and 1.7 percent in 2027. Export growth is restrained by U.S. tariffs and a stronger euro, though a gradual recovery in the euro area offers some support.

Sorjonen sees little chance of a swift turnaround. "Finland has no extra resources for major recovery measures, and state debt is still growing," he said. While investment in the defense sector may help, he warned that weak household confidence remains the biggest obstacle. "If families do not resume spending, recovery will stall."

Sorjonen said his confederation has urged the government to introduce targeted policies to boost employment and improve labor-market inclusion.