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5 Facts about Poverty in Finland

Facts About Poverty in Finland
Many know Finland as one of the happiest countries in the world. Not only do people know Finland for the iconic Northern Lights, but they also consider it to be one of the least poverty-stricken countries in all of Europe. Finland has the fourth-lowest poverty rate in OCED countries and a Gini coefficient of .27, which is lower than the United States. Here are five facts about poverty in Finland.

5 Facts About Poverty in Finland

  1. Finland has a high quality of life. In fact, Finland has one of the highest quality of life scores in Europe. Its score of 8.2 out of 10 is higher than the average 7.4 rate in the European Union as of 2016. People are generally happier in Finland and the number has stayed consistent since 2003.
  2. Finland’s unemployment rate was approximately 7% as of 2018. This is a huge improvement over the last couple of years, where the unemployment rate was close to 10% in 2014. Since then, the unemployment rate has dropped to a little more than 6% as of January 2020. This number is significantly lower than Finland’s youth unemployment rate which was close to 17% in 2017, but it is a huge improvement from its 2016 youth unemployment rate of nearly 20%.
  3. Finland’s GDP per capita has been steadily increasing over the years. Finland’s GDP per capita has increased by more than 8% from 2017 to 2018. Finland ranks as having one of the highest GDP per capita with numbers higher than countries including Canada, France and the United Kingdom.
  4. Finland’s education system has been improving since the 1970s. Finland ranks first out of all OCED countries on the PISA test. The PISA is an academic test in language, math and science that 15-year-old kids take internationally. Many attribute Finland’s successful education system to its investment in teachers’ education. More than half of Finland’s adult population finish some form of education which could be due to the fact that Finland’s government pays for close to 100% of the cost of education.
  5. Finland’s child poverty rate is one of the lowest in OCED countries. Finland has a child poverty rate of 4%, compared to the U.S. child poverty rate of 20%. This is due to Finland shifting welfare policies from local government to big government by providing mothers with public daycare and allowances for children under the age of 17. Finland’s child poverty rate is not only lower than the United States but also Germany, Sweden and Australia.

Concluding Thoughts

The probability of someone becoming poor in Finland is actually lower than the probability of them becoming poor in all of Europe. In 2016, the chance of someone in Finland being at risk of poverty was approximately 16% compared to 22% in the European Union as of 2019. Finland also has one of the highest Human Development Indexes (HDI) with a placement of number 12 out of 189 countries. Its HDI has been increasing for nearly two decades now and sits at a .925 as of 2018. One can attribute Finland’s success as a country to an increased life expectancy at birth since 1990, an increased number of expected and mean schooling since 1990 and an increase in its Gross National Income (GNP) per capita since 1990. These five facts about poverty in Finland show that overall, Finland is one of the most prosperous countries in Europe due to the exceptional education system, low poverty rate and expanding economy.

– Hena Pejdah
Photo: Flickr

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Top 10 Facts About Poverty in Finland: Issues & Solutions

Top 10 Facts About Poverty in Finland
Today, Finland has a reputation for one of the lowest poverty rates in the world, and thousands of Finns live below the poverty level. These top 10 facts about poverty in Finland will help put into perspective the socio-economic issues Finland faces today.

Facts About Poverty in Finland

  1. Finland’s poverty rate is 5.8 percent, based on a 50 percent threshold of the average income from the OECD’s most recent report. In recent years, the at-risk-of-poverty percentage hit its peak in 2008 at 13.9 percent but dropped to 11.7 percent by 2015. Finland’s low poverty rate is right behind Denmark’s and not too far from the other Nordic countries.
  2. In 2016, the National Institute for Health and Welfare (THL) reported approximately 400,000 people — or 8 percent — of the Finnish population live underneath Finland’s minimum budget of 669 euros.
  3. Finland’s welfare system is based on the Nordic model, which emphasizes socio-economic equality. In turn, Finland strives to maintain a financial safety net for its citizens and reduce poverty. Politicians such as Bernie Sanders have used the Nordic model as an example to propose solutions to inequality in the U.S.
  4. Finns hold an unusually high amount of trust in each other, and tend to be more willing to pay high taxes needed for the nation’s welfare system. According to a recent Eurobarometer study, more than 80 percent of Finns say that they trust other Finns; this percentage is higher than in any other country in Europe.
  5. As of 2014, the child poverty rate in Finland was 3.6 percent. Child poverty tends to be lower in countries that spend a high percentage of their GDP on social programs, so Nordic countries including Finland possess some low poverty rates.
  6. The shortage of affordable housing ails low-income people and the homeless. One of the largest contributing factors to poverty in Finland is expensive housing costs, especially in urban areas. However, programs like Housing First help ensure that Finns have someplace to live, even at their lowest, most desperate moments. The program is funded by the government and has housed previously homeless Finns for extended periods of time.
  7. Low-income individuals and families have trouble accessing proper social and health services because of growing customer fees. Finland spends 8.6 percent of its GDP on healthcare, which is below the OECD average of 8.9 percent.
  8. In recent years, the number of unemployed immigrants has reached between 2 to 5 times more than that of the average Finn. As a result, more than 50 percent of immigrant households in Finland live in poverty. To combat immigrant unemployment rates, the European Investment Fund recently allotted 10 million euros for an experiment by the Ministry of Economic Affairs and Employment that aims to provide skilled labor jobs for 2,500 unemployed immigrants.
  9. In January 2017, Finland became one of the first countries to start a universal basic income (UBI) experiment. Each month, they gave a stipend of approximately $680 to 2,000 unemployed people living below the poverty level. In theory, the experiment poses a potential solution to eliminating poverty within the country by providing enough money for each citizen to live frugally — regardless of social class. The experiment is set to end in December 2018, and the results of the experiment have not yet been released.
  10. In line with the Europe 2020 Strategy, Finland aims to lower the number of people living in poverty or social exclusion to 770,000 by 2020. According to Statistics Finland, currently 849,000 people live in poverty or social exclusion.

Poverty & Perseverance

Even with Finland’s success combatting poverty in comparison to other world powers, any trend of rising poverty or other negative living conditions within a nation is a continued concern. Finland will continue to experiment with other social programs for the financial security of its people, and hopefully the number of unemployed and impoverished will continue to decrease as a result of these efforts.

– Jessica Reyes
Photo: Flickr