2. 6.6.2014 2
The Technology Industry Is Comprised
of Five Sub-sectors
Metals Industry
Boliden, Componenta, Kuusakoski,
Luvata, Norilsk Nickel, Outokumpu,
Outotec, Ovako, Rautaruukki,
Sacotec…
Mechanical
Engineering
Abloy, Cargotec, Fiskars,
Glaston, Kone, Konecranes,
Metso, Normet, Oras, Patria,
Pemamek, Ponsse, Prima
Power, Stala, STX Finland,
Valtra, Wärtsilä...
Electronics and
Electrotechnical Industry
ABB, Ensto, Microsoft Mobile, Murata
Electronics, Nokia, Planmeca, Polar
Electro, Suunto, Vacon, Vaisala…
Information Technology
Affecto Finland, Basware, CGI,
Codebakers, Codenomicon,
Comptel, Digia, Efecte, Enfo,
F-Secure, Fujitsu Finland, IBM,
Knowit, Microsoft, Nixu, Tieto…
Consulting Engineering
A-insinöörit, Citec, Elomatic,
Etteplan, FCG, Finnmap, Granlund,
Neste Jacobs, Pöyry, Ramboll,
Sito, SWECO, Vahanen, WSP…
3. 3
The Technology Industry
in Finland
Mechanical Engineering
• Machinery, metal products,
vehicles
• Turnover (2013): 26.5 billion euros
• Personnel (2013): 132 600
Electronics and
Electrotechnical Industry
• Data communications equipment,
instruments, electrical machinery
• Turnover (2013): 14.3 billion euros
• Personnel (2013): 46 600
Information Technology
• IT services, applications
and programming
• Turnover (2013): 8.4 billion euros
• Personnel (2013): 55 200
Metals Industry
• Steel products, non-ferrous
metals, castings
• Turnover (2013): 9.5 billion euros
• Personnel (2013): 15 900
Consulting Engineering
• Expertise for construction
industry and infrastructure
• Turnover (2013): 5.5 billion euros
• Personnel (2013): 45 700
6.6.2014
4. • 55% of total Finnish exports.
• 80% of private-sector
R&D investment.
• Almost 290,000 employed
directly in the sector, 720,000
employed in total, equalling
about 30% of the entire Finnish
labour force.
• The Federation of Finnish
Technology Industries has over
1,600 member companies.
6.6.2014 4
The Technology Industry –
the Most Important Sector in Finland
5. 6.6.2014 5
0
2
4
6
8
10
12
14
16
18
20
22
24
26
28
30
32
34
2005 2006 2007 2008 2009 2010 2011 2012 2013
Mechanical engineering
Electronics and
electrotechnical industry
Metals industry
Information technology
Consulting engineering
Turnover of the Technology Industry in Finland
Source: Statistics Finland, The Federation of Finnish Technology Industries
Billion euros, at current prices
6. 6.6.2014 6
Export of Technology Industry Goods from Finland
by Area in 2013
Total goods exports 24.8 billion euros*
*) In addition to goods exports the sector exports services worth about 12 billion euros.
Source: National Board of Customs, Statistics Finland
North America
2.2 billion €
8.8 %
Western Europe
11.4 billion €
46.1 %
Middle and
Central East
0.7 billion €
2.8 %
Asia
4.1 billion €
16.5 %
Africa
0.5 billion €
2.1 %
South and Middle America
1.0 billion €
4.1 %
Central and Eastern Europe
4.9 billion €
19.6 %
7. Turnover of the Industry and Technology Industry
in Finland
80
90
100
110
120
130
140
150
2005 = 100
Industry
Technology
industry
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Change: 1-2,2014 / 1-2,2013, %
Seasonally adjusted turnover index, latest information 2/2014.
Source: Statistics Finland
-3 %
-5 %
6.6.2014 7
8. Turnover of the Technology Industry in Finland
50
60
70
80
90
100
110
120
130
140
150
160
170
180
190
200
2005 = 100
Information technology
Consulting engineering
Mechanical engineering
Metals industry
Electronics and electrotechnical
industry
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Change: 1-2,2014 / 1-2,2013, %
Source: Statistics Finland
Seasonally adjusted turnover index, latest information 2/2014. Share of total turnover in 2012: mechanical engineering 41 %, electronics
and electrotechnical industry 26 %, metals industry 14 %, information technology 11 %, consulting engineering 8 %
+4 %
+14 %
-6 %
-10 %
-4 %
6.6.2014 8
9. 6.6.2014
Value of New Orders in the Technology Industry* in
Finland
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
11,000
12,000
Combined
Export
Domestic
Million euros, at current prices
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-March 2014
*) Excluding metals industry and game industry companies.
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Change: I,2014 / I,2013 I,2014 / IV,2013
Export: +5 % -8 %
Domestic: +13 % +22 %
Combined: +7 % -1 %
9
10. 6.6.2014
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
22,000
24,000
Export
Domestic
Value of Order Books in the Technology Industry* in
Finland
Million euros, at current prices
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 31.3.2014
*) Excluding metals industry and game industry companies.
Combined
Change: 31.3.2014 / 31.3.2013 31.3.2014 / 31.12.2013
Export: -5 % -2 %
Domestic: +6 % +11 %
Combined: -2 % +1 %
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
10
11. Tender Requests* Received by Technology Industry
Companies
Source: The Federation of Finnish Technology Industries’ order book survey, latest information: April
2014.
”Have you experienced a notable increase or decrease in the number of requests for tenders in recent weeks in comparison to the
situation three months ago?”. Balance figure = the number of companies receiving more requests - the number of companies receiving
less requests
-60
-50
-40
-30
-20
-10
0
10
20
30
40
Balance figure
116.6.2014
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
12. 6.6.2014
Value of New Orders in the Electronics and
Electrotechnical Industry in Finland
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
6,500
7,000
Combined
Export
Domestic
Million euros, at current prices
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Change: I,2014 / I,2013 I,2014 / IV,2013
Export: -5 % -25 %
Domestic: -4 % +30 %
Combined: -5 % -21 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-March 2014
12
16. 6.6.2014
Value of New Orders in the Consulting Engineering in
Finland
0
20
40
60
80
100
120
140
160
180
200
220
240
260
280
300
320
Combined
Export
Domestic
Million euros, at current prices
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Change: I,2014 / I,2013 I,2014 / IV,2013
Export: -11 % -9 %
Domestic: +11 % +5 %
Combined: +8 % +3 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-March 2014
16
17. 6.6.2014
0
50
100
150
200
250
300
350
400
450
500
550
600
Export
Domestic
Value of Order Books in the Consulting
Engineering in Finland
Combined
Million euros, at current prices
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 31.3.2014
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Change: 31.3.2014 / 31.3.2013 31.3.2014 / 31.12.2013
Export: -1 % -3 %
Domestic: +18 % +10 %
Combined: +15 % +8 %
17
18. 6.6.2014
Value of New Orders in the Information
Technology in Finland
0
50
100
150
200
250
300
350
400
450
500
550
600
650
700
750
800
Million euros, at current prices
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Change: I,2014 / I,2013 I,2014 / IV,2013
Combined: -5 % +7 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information January-March 2014
18
*) Excl. game industry companies.
19. 6.6.2014
Value of Order Books in the Information
Technology in Finland
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
Million euros, at current prices
2007 2008 2009 2010 2011 2012 2013 2014
Change: 31.3.2014 / 31.3.2013 31.3.2014 / 31.12.2013
Combined: +6 % +7 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 31.3.2014
19
*) Excl. game industry companies.
20. -100 %
-80 %
-60 %
-40 %
-20 %
0 %
20 %
40 %
60 %
80 %
100 %
120 %
140 %
160 %
180 %
200 %
Change in Value of Order Books in the Technology
Industry in Finland Compared with a Year Earlier
Source: The Federation of Finnish Technology Industries’ order book survey’s
respondent companies, latest information 31.3.2014
Change by companies: 31.3.2014 / 31.3.2013, %
Average: -2 %
Companies in random order
Median: +1 %
6.6.2014 20
21. Personnel in the Technology Industry
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
220,000
240,000
260,000
280,000
300,000
320,000
340,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
(31.3)
Personnel in Finland Personnel in subsidiaries abroad
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force
survey
Some 18 000 of employees
affected by temporary or part-
time lay-offs 31.3.2014
6.6.2014 21
22. Technology Industry Personnel in Finland
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
(31.3.)
Electronics and electrotechnical industry Mechanical engineering
Metals industry Consulting engineering
Information technology
Source: Statistics Finland, The Federation of Finnish Technology Industries’
labour force survey
6.6.2014 22
23. Technology Industry Personnel in Subsidiaries Abroad
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Electronics and electrotechnical industry Mechanical engineering
Metals industry Consulting engineering
Information technology
Source: The Federation of Finnish Technology Industries’
labour force survey
6.6.2014 23
24. 6.6.2014 24
Retirement of Technology Industry Personnel
0
1000
2000
3000
4000
5000
6000
7000
8000
9000
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Number of individuals retired
Number of individuals retiring (estimation)
Source: Wage inquiry of the Federation of Finnish Technology Industries,
Finnish Centre for Pensions, Statistics Finland
Individuals per year
Salaried employees
Blue collar employees
25. 6.6.2014 25
Retirement of Technology Industry Blue Collar
Employees
0
500
1000
1500
2000
2500
3000
3500
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Mechanical engineering
Metals industry
Electronics and electrotechnical industry
Source: Wage inquiry of the Federation of Finnish Technology Industries,
Finnish Centre for Pensions, Statistics Finland
Individuals per year
26. Situational overview and outlook
• - Finland is in the grip of structural change. Development remains
uneven between companies.
• - Turnover in Finland in 2013 was some EUR 64 billion. Turnover in the
pre-crisis year 2008 was EUR 82 billion.
• - The monetary value of new orders in January-March 2014 was 7 %
higher than in the corresponding period of 2013, but slightly lower than
at the level of the preceding quarter.
• - At the end of March, the value of order books was 2 % lower year on
year, but slightly higher the value reported at the end of December.
• - The turnover of technology industry companies in the spring of 2014 is
expected to be roughly equal in comparison with the corresponding
period last year.
• - Since 2008, personnel numbers in Finland have shrunk by over 30,000
employees, totalling 288,000 at the end of March 2014.
6.6.2014 26
27. 6.6.2014 27
Better growth outlook in
Western Europe
- Recession in Russia will
have significant impacts in
Finland
30. Improving Growth in Euro Area
Latest information May 2014.
Source: Markit, Eurostat
6.6.2014 30
31. Growth Continues in Developing Countries,
but Slower than During Last Years
Latest information April 2014.
Source: Markit, HSBC
Teollisuuden ja palvelualojen ostopäällikköindeksi
6.6.2014 31
32. Russian Economy Has Entered a Recession
Latest information May 2014.
Source: Markit, HSBC
6.6.2014 32
33. World Economic Growth in 2014e
Source: IMF (April 2014)
-1
0
1
2
3
4
5
6
7
8
9
10
0 10 20 30 40 50 60 70 80 90 100
North America
Western Europe Japan
China
India
Rest of
Asia
RestofEasternEurope
Russia
Brazil
Mexico
RestofLatinAmerica
MiddleEast,Africa
GDP growth in 2014, %
The width of the bar indicates the share (purchasing power parity adjusted) of world GDP in 2013, %
Average growth: +3,6 %
6.6.2014 33
34. World Economic Growth in 2014e with the
Export Shares
Source: IMF (April 2014), Board of Customs
-1
0
1
2
3
4
5
6
7
8
9
10
0 10 20 30 40 50 60 70 80 90 100
North America
Western Europe Japan
China
India
Rest of
Asia
RestofEastern
Europe
Russia
Brazil
Mexico
RestofLatinAmerica
MiddleEast,Africa
GDP growth in 2014, %
The width of the bar indicates the export share of technology industry from Finland in 2013, %
Average growth: +2,4 %
6.6.2014 34
35. 6.6.2014 35
Breakdown of World Industrial Production
0
5
10
15
20
25
30
35
40
45
50
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Asia
North America
Europe
Purchasing power parity adjusted shares.
Source: Maddison (Historical Statistics), IMF and ETLA
%
38. 6.6.2014
Finnish Exports up to EUR 20 – 30 Billion Short of
Annual Target Level
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
Exports needed to
avoid extra running
into debt in the
public sector
Exports, realized
Working day and seasonally adjusted index.
Latest information October-December 2013.
Source: Statistics Finland / National Accounts
Export of goods and services by quarter, billion euros, at current prices
38
2005 2006 2007 2008 2009 2010 2011 2012 2013
40. The Share of Industry in GDP in Finland 1900-2012
0%
5%
10%
15%
20%
25%
30%
35%
Industry Industry + service sectors in the technology industry
Source: Statistics Finland
6.6.2014 40
41. 6.6.2014 41
90
95
100
105
110
115
120
125
130
135
140
2005 2006 2007 2008 2009 2010 2011 2012 2013e 2014e 2015e
Germany
Netherlands
Sweden
USA
Switzerland
Finland
Finland not attracting Companies’ Investment
Companies’ Fixed Investments in Different Countries
Source: OECD, Economic Outlook, November 2013
Indeksi, 2005=100
42. Unit Labour Costs at the National Economy Level
(Including the Effective Exchange Rates)
90
95
100
105
110
115
120
Compared to Germany Compared to Spain Compared to Italy
Compared to the Netherlands Compared to Austria Compared to Finland
*) In the ECB Harmonised Competitiveness Index, the average effective exchange rate of each country
is calculated vis-à-vis 20 to 30 main trade partners, as well as the development of unit labour costs for
the total economy
Latest information IV/2013.
Source: European Central Bank
Finland’s cost
competitiveness
declines
2005,I =100
Finland’s cost
competitiveness
improves
6.6.2014 42
2005 2006 2007 2008 2009 2010 2011 2012 2013
43. What should be done?
• Support the renewal of the industry
• Taxes should support growth and investment in Finland
• Support decision making in companies related to
compensation and working time
• No new European nor national burdens on companies,
which are deteriorating the competitiveness
6.6.2014 43
44. Long-Term Outlook and Challenges
• Global Structural Change Set to Continue Apace
– Industrial production and services will relocate to rapidly developing
economic areas
– Strong growth, large markets, cheap labour and increasing expertise will
increase the attractiveness of these regions.
• Competition over Skills and Raw Materials Set to Increase
– Due to an increase in retirement, the sector’s annual recruitment need in
Finland will rise considerably in the coming years.
– The availability of reasonably-priced energy also threatens to become an
investment bottleneck in Finland
• Combating Climate Change
– A challenge as costs are set to grow faster than in competitor countries
– An opportunity for new environmental and energy technologies
6.6.2014 44