In 2005, the Finnish economy grew more slowly than had been expected. Growth sagged during the first half of the year because of labour disputes in the forest industry and international economic trends, but picked up towards the end of the year. According to preliminary data for 2005, Finland’s total production increased by 2.1 per cent on the previous year. Industrial production fell, but trade and services showed a rising trend.
In 2004, Finnish exports rose to nearly EUR 48.8 billion, which is five per cent more than the year before. Exports were higher than this only in 2000. According to preliminary data for 2005, the value of exports was EUR 52.4 billion, or 7 per cent more than in the year before. Owing to increased re-exports of industrial products, the exports of industry from Finland continued to rise although the volume of industrial production in Finland fell. For instance in the electronics sector, a major share of export products were manufactured in countries other than Finland.
The Finnish industry’s investments in real property increased by about 7 per cent in 2005. Investments have increased moderately since 2004, and slight growth is also expected for the current year. The targeting of investments has been undergoing a structural change in recent years. The importance of research and product development has risen, whereas the relative share of fixed investments has fallen.
Employment improved in 2005 more rapidly than had been anticipated; the employment rate is likely to rise to 68 per cent. Jobs were created especially in private services and in the building sector. The falling trend in the number of jobs in industry also levelled off.
According to the SME barometer survey published by Finnvera and the Federation of Finnish Enterprises in October 2005, SMEs have positive expectations for the future and believe that their business operations will increase in 2006. The dent in the growth rate of the economy in early 2005 had no significant effect on the development or future outlook of SMEs. SMEs also expected to invest more than in the survey conducted the year before; the willingness to invest has increased especially in the building and service sectors.