Soste proposes new fund model to combat long-term unemployment

Soste, a national umbrella organization for social and health organizations, has proposed a new fund model designed to combat long-term unemployment in Finland. The proposal, referred to as the ‘employment responsibility model’, suggests transferring employment subsidies, such as wage subsidies, to an Employment Fund managed jointly by labor market organizations.

Under this model, employers with more than 50 employees in both the public and private sectors would bear additional responsibility. Soste views labor market marginalization as a societal harm similar to pollution, which employers should compensate for. Companies could fulfill this responsibility by hiring long-term unemployed individuals, people with disabilities, or those with partial work capacity, or by subcontracting labor from organizations or funding the fund directly.

The proposal suggests that the Ministry of Economic Affairs and Employment would provide the initial capital for the fund. Subsequent funding from the ministry would be performance-based, tied to how effectively the fund reduces unemployment benefit expenditures and increases taxable earnings. Soste argues this would align Finland with most other EU member states and lead to significant long-term public savings.