Results of municipal employment experiments should be monitored systematically

The Ministry of Economic Affairs and Employment should systematically monitor the results of municipal employment experiments during the ongoing government term, recommends the National Audit Office of Finland (NAOF) in its audit. In addition, high-quality impact assessments should be made of the experiments. This would promote employment and the effectiveness of employment services.

The regional employment experiments of 2017–2018 decreased the number of long-term unemployed and reduced the unemployment rate in the regions that participated in the experiments. However, based on statistics from the jobseeker register, it is not possible to conclude the extent to which the development resulted from increased participation in the services or from employment in the open labour market.

The audit was targeted at the public employment and business services (TE services) provided by the Employment and Economic Development Offices (TE Offices), as well as the implementation of reforms related to the management of employment at TE Offices during the government term 2015–2019. The reforms examined in the audit included regional employment experiments and jobseekers’ periodic interviews.

“Many reforms were carried out at the same time during the previous government term. This makes it difficult to assess their impacts. In future, major reforms and experiments should be implemented in such a manner that it is possible to make high-quality assessments of them,” says Principal Performance Auditor Hannu Tervo.

Increasing the number of periodic interviews resulted in increased contacts between TE Offices and customers and improved the efficiency of directing jobseekers to employment services. However, the increase in periodic interviews also added to the workload of TE Offices’ personnel. Based on the audit, the reform was positive overall.

TE administration was relatively well-placed to provide employment services, regardless of the decrease in appropriations

The TE administration used almost EUR 600 million in 2015 for promoting employment and fighting unemployment. In 2018, the amount of appropriations used was EUR 490 million, i.e. about 18 per cent less than in 2015.

Regardless of the decrease in appropriations, the TE administration was relatively well-placed to provide employment services. The employment situation also improved towards the end of the review period, which reduced the need for TE services.

“Overall, the acquisition of services reduced somewhat during the review period. However, the use of services with a smaller impact on employment, such as rehabilitative work activities, trainings, and wage subsidies to municipalities, slightly increased during the review period,” says Tervo.

Read the publication: Provision and reforms of employment services in 2015–2019