Immigrants on average make less money than Finns, specifically the ones from non-western countries. Foreigners have earned less than Finns for some time, but the gap is now widening. According to research by Statistics Finland a foreigner earned six per cent less than a native Finn during 2007. In 2001 the pay discrepancy was only one per cent. The study bases the reasons for this widening pay gap on the fact that many more foreign employees work in lower paid jobs. The Filipinos have an average income on 1800 Euro and ranks last on the list on nationality.
Researcher Antti Katainen of Statistics Finland points out that wage differentials have matched the needs of the Finnish labour market. “I think that the most important aspect of the study was that the earnings were mainly very competitive for those foreign employees who are mending the lack of skills and know-how, and weaker for those who are mending the lack of the Finnish work force,” he says.
Although much of the pay gap can be explained by structural differences in the foreign and domestic segments of the labour force, there are some indications of discrimination. “By discrimination, I mean the wage inequality that cannot be explained via earnings data,” Katainen explains. “In other words, there was still some equality although I standardised employee gender, age, occupation and economic activity in my calculations.”
There were very wide differences in the pay of various nationalities. Some nationalities earned considerably more than Finns. These include foreigners from Austria, India, Denmark and the Netherlands, all of whom earned on average 30 per cent more than the Finnish average. In contrast, people from Uzbekistan, Somalia, Thailand and the Philippines earned over 30 per cent less.
The study pointed to different careers for the disparity among citizens of different states. The study states that the highest paid nationalities were much more likely to be employed in the high-paying IT sector. Those from countries at the bottom of the scale were more often found in lower-paying positions such as cleaners or warehouse workers.
In some professions foreigners had higher earnings than Finns. These include sales and marketing directors, bus drivers and cooks. The study concluded that foreigners were more likely to work nights and weekends as bus or tram drivers and so were paid more. In the cooking profession, Finns were more often found in lower-paid schools and health centres while foreigners were more common in private restaurants which pay better.
In comparison, a foreign doctor, maintenance man, cleaner or cargo handler was more likely to be paid less than a Finnish colleague. There were also large discrepancies in pay for construction workers. The study cited as examples that foreign painters and plasterers were paid 10 and 26 per cent less than Finnish counterparts respectively.
Despite the current economic slowdown and increase in redundancies, Katainen is certain that there will still be a demand for more foreign workers in the future. “Definitely, yes,” he replies emphatically. “The Finnish population is ageing and there will be a lot of open jobs in the future in many different kinds of activities and occupations.”