Transcript The Federation of Finnish Technology Industries
The Federation of Finnish Technology Industries
January 2014
The Technology Industry Is Comprised of Five Sub-sectors
Electronics and Electrotechnical Industry
ABB, Ensto, Murata Electronics, Nokia, Nokia Siemens Networks, Planmeca, Polar Electro, Suunto, Vacon, Vaisala...
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...
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 … 28.4.2020
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The Technology Industry in Finland
Electronics and Electrotechnical Industry
• Data communications equipment, instruments, electrical machinery • Turnover (2012): 16.3 billion euros • Personnel (30.9.2013): 46 000
Metals Industry
• Steel products, non-ferrous metals, castings • Turnover (2012): 10.2 billion euros • Personnel (30.9.2013): 16 000
Mechanical Engineering
• Machinery, metal products, vehicles • Turnover (2012): 27.9 billion euros • Personnel (30.9.2013): 129 100
Information Technology
• IT services, applications and programming • Turnover (2012): 7.5 billion euros • Personnel (30.9.2013): 54 000
Consulting Engineering
• Expertise for construction industry and infrastructure • Turnover (2012): 5.2 billion euros • Personnel (30.9.2013): 43 000 28.4.2020
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The Technology Industry – the Most Important Sector in Finland
• • 55% of total Finnish exports.
• 80% of private-sector R&D investment.
Almost about 290,000 30% labour force.
employed directly in the sector, 720,000 employed in total, equalling of the entire Finnish • The Federation of Finnish Technology Industries has some 1,600 member companies.
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Turnover of the Technology Industry in Finland 10 8 6 4 2 0 34 32 30 28 26 24 22 20 18 16 14 12
Billion euros,at current prices
2005 2006 2007 2008 2009 2010 2011 2012
Metals industry Mechanical engineering Electronics and electrotechnical industry Information technology Consulting engineering Source: Statistics Finland
Export of Technology Industry Goods from Finland by Area in 2012
Total goods exports 26.5 billion euros* Western Europe 12.0 billion € 45.2 % Central and Eastern Europe 5.3 billion € 20.2 % North America 2.2 billion € 8.2 % South and Central America 1.5 billion € 5.5 % Africa 0.8 billion € 3.0 % the Middle East 0.6 billion € 2.3 % Asia 4.1 billion € 15.6 % *) In addition to goods exports the sector exports services worth about 12 billion euros.
Source: National Board of Customs, Statistics Finland 28.4.2020
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Turnover of the Industry and Technology Industry in Finland
120 110 100 90 150 2005 = 100 140 130 Change: 1-9, 2013 / 1-9, 2012, % 80
2005 2006 2007 2008 2009 2010
Seasonally adjusted turnover index, latest information 9/2013.
2011 2012 2013
Industry
-4 %
Technology industry
-6 %
Source: Statistics Finland 28.4.2020
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Turnover of the Technology Industry in Finland
100 90 80 70 60 50 200 190 180 170 160 150 140 130 120 110 2005 = 100 Change: 1-9,2013 / 1-9,2012, % Information technology
+11 %
Consulting engineering
+3 %
Mechanical engineering
-6 %
Metals industry
-8 %
Electronics and electrotechnical industry
-13 % 2005 2006 2007 2008 2009 2010 2011 2012 2013
Seasonally adjusted turnover index, latest information 9/2013. Share of total turnover in 2012: mechanical engineering 41 %, electronics and electrotechnical industry 26 %, metals industry 14 %, information technology 11 %, consulting engineering 8 % Source: Statistics Finland 28.4.2020
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Value of New Orders in the Technology Industry* in Finland
12000 11000 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 Million euros, at current prices Combined Export Domestic
2005
Change: Export: Domestic: Combined:
2006 2007 2008 2009 2010 2011
III,2013 / III,2012 -30 % +1 % -24 %
2012 2013
III,2013 / II,2013 -24 % -21 % -23 % *) Excluding metals industry.
Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information July-September 2013 28.4.2020
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Value of Order Books in the Technology Industry* in Finland
Million euros, at current prices 24000 22000 20000 18000 16000 14000 12000 10000 8000 6000 4000 2000 0 Combined Export Domestic
2005 2006 2007
Change: Export: Domestic: Combined: *) Excluding metals industry.
2008 2009 2010
30.9.2013 / 30.9.2012
-12 % -3 % -10 %
2011 2012 2013
30.9.2013 / 30.6.2013
-10 % -2 % -8 % Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information 30.9.2013
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Change in Value of Order Books in the Technology Industry in Finland Compared with a Year Earlier 200 %
Change by companies: 30.9.2013 / 30.9.2012
180 % 160 % 140 % 120 % 100 % 80 % 60 % 40 % 20 % 0 % -20 % -40 % -60 % -80 % -100 %
Companies in random order Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information 30.9.2013
Median: 0 % Average: -10 % 28.4.2020
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Value of New Orders in the Electronics and Electrotechnical Industry in Finland
7000 6500 6000 5500 5000 4500 4000 3500 3000 2500 2000 1500 1000 500 0 Million euros, at current prices
2005
Change: Export: Domestic: Combined:
2006 2007 2008 2009 2010 2011
III,2013 / III,2012 -51 % -10 % -48 %
2012 2013
III,2013 / II,2013 -42 % -11 % -39 % Combined Export Domestic Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information July-September 2013 28.4.2020
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Value of Order Books in the Electronics and Electrotechnical Industry in Finland
8000 7500 7000 6500 6000 5500 5000 4500 4000 3500 3000 2500 2000 1500 1000 500 0 Million euros, at current prices
2005 2006 2007 2008 2009 2010 2011
Combined
2012 2013
Export Domestic Change: Export: Domestic: Combined: 30.9.2013 / 30.9.2012
-43 % -18 % -41 % 30.9.2013 / 30.6.2013
-33 % -10 % -32 % Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information 30.9.2013 28.4.2020
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Value of New Orders in the Mechanical Engineering in Finland
5000 4500 Million euros, at current prices 4000 3500 3000 2500 2000 1500 1000 500 0
2005 2006 2007 2008
Change: Export: Domestic: Combined:
2009 2010 2011
III,2013 / III,2012 +4 % -8 % +1 %
2012 2013
III,2013 / II,2013 0 % -26 % -7 % Combined Export Domestic Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information July-September 2013 28.4.2020
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Value of Order Books in the Mechanical Engineering in Finland
15000 14000 13000 12000 11000 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 Million euros, at current prices
2005
Change: Export: Domestic: Combined:
2006 2007
Combined
2008 2009 2010
30.9.2013 / 30.9.2012
+5 % -5 % +3 %
2011 2012 2013
30.9.2013 / 30.6.2013
+1 % +1 % +1 % Export Domestic Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information 30.9.2013 28.4.2020
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Value of New Orders in the Consulting Engineering in Finland
Million euros, at current prices 320 300 280 260 240 220 200 180 160 140 120 100 80 60 40 20 0
2005
Change: Export: Domestic: Combined:
2006 2007 2008 2009 2010
III,2013 / III,2012 -10 % +9 % +6 %
2011 2012 2013
III,2013 / II,2013 -23 % -4 % -7 % Combined Export Domestic Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information July-September 2013 28.4.2020
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Value of Order Books in the Consulting Engineering in Finland
600 550 500 Million euros, at current prices 450 400 350 300 250 200 150 100 50 0
2005 2006 2007 2008
Change: Export: Domestic: Combined: Combined
2009 2010
30.9.2013 / 30.9.2012
-3 % +22 % +16 %
2011 2012 2013
30.9.2013 / 30.6.2013
-13 % -3 % -5 % Export Domestic Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information 30.9.2013 28.4.2020
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Value of New Orders in the Information Technology in Finland
350 300 250 200 150 100 50 0 800 750 700 650 600 550 500 450 400 Million euros, at current prices
2005 2006 2007 2008
Change: Combined:
2009 2010 2011
III,2013 / III,2012 +29 %
2012 2013
III,2013 / II,2013 -18 % Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information July-September 2013 28.4.2020
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Value of Order Books in the Information Technology in Finland
2000 1800 1600 1400 1200 1000 800 600 400 200 0 Million euros, at current prices
2007
Change: Combined:
2008 2009 2010 2011 2012 2013
30.9.2013 / 30.9.2012
-3 % 30.9.2013 / 30.6.2013
-2 % Source: The Federation of Finnish Technology Industries ’ order book survey’s respondent companies, latest information 30.9.2013
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Personnel in the Technology Industry 340 000 320 000 300 000 280 000 260 000 240 000 220 000 200 000 180 000 160 000 140 000 Some 15 000 of employees affected by temporary or part-time lay-offs 2008 2009 Personnel in Finland 2010 2011 2012 Personnel in subsidiaries abroad 2013 (30.9.)
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force survey 28.4.2020
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Technology Industry Personnel in Finland 160 000 140 000 120 000 100 000 80 000 60 000 40 000 20 000 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 (30.9) Metals industry Mechanical engineering industry Electronics and Electrotechnical Industry Information technology Consulting engineering
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force survey 28.4.2020
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Retirement of Technology Industry Personnel 9000
Individuals per year
8000 7000 6000 5000 4000 3000 Salaried employees 2000 Blue collar employees 1000 0 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 28.4.2020
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Retirement of Technology Industry Blue Collar Employees 3500
Individuals per year
3000 2500 2000 1500 1000 500 0 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 28.4.2020
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Situational overview and outlook
• • • • • • • Finland is in the grip of structural change. Development remains uneven between companies. - Turnover in Finland in 2012 was some EUR 67 billion. Turnover in the pre-crisis year 2008 was EUR 81 billion. - The monetary value of new orders in July-September 2013 was 24 % lower than in the corresponding period of 2012, and 23 % lower than at the level of the preceding quarter.
- At the end of September, the value of order books was 10 % lower year on year, and 8 % lower the value reported at the end of June.
- The turnover of technology industry companies could fall by as much as almost 10 per cent year-on-year, being significantly lower than in the times preceding the 2008 financial crises. - Since 2008, personnel numbers in Finland have shrunk by 30,000 employees, totalling 288,000 at the end of September. - Small and medium-sized enterprises in particular have reported weak development in profitability. 28.4.2020
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European recovery is unconsistent
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105 100 95 75 70 65 90 85 80
Industrial Production Volume
Industrial production volume in EU countries 10 %, but in Finland 18 % lower since early 2008
2008=100
110
2008 2009 2010 2011 2012 2013
Seasonally adjusted volume index, latest information 10/2013 or 11/2013. Source: Eurostat, Federal Reserve (USA), Statistics Bereau and Statistics Center 28.4.2020
(Japan) USA EU28 countries Japan Finland
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Industrial Production Volume in EU Countries
125
2008=100
120 115 110 105 100 95 90 85 80 75 70
2008 2009 2010 2011 2012 2013
Seasonally adjusted volume index, latest information 9/2013 or 2013. Source: Eurostat 28.4.2020
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Poland Estonia Belgium Austria Germany Sweden Finland Italy Spain
The Share of Industry in GDP in Finland 1900-2012 35% 30% 25% 20% 15% 10% 5% 0%
Industry Source: Statistics Finland Industry + service sectors in the technology industry 28.4.2020
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Breakdown of World Industrial Production % 50 45 40 35 30 25 20 15 10 5 0
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 28.4.2020
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Industrial Production Development by Year
220 200 180 160 140 120 100 80 320 300 280 260 240 2005=100
2005 2006 2007 2008 2009 2010 2011 2012 2013e 2014e
Source: Consensus Economics 28.4.2020
China Korea India Russia Finland Brazil USA Euroarea Japan 30
Almost all Western Countries have Excessive Public Debt
90 80 70 60 50 40 30 20 210 200 190 180 170 160 150 140 130 120 110 100 Public debt / GDP, %
2005 2006 2007 2008 2009 2010 2011 2012 2013e
Source: OECD, Economic Outlook, November 2013
Greece Italy Irland Portugal Belgium Germany Spain Finland Sweden
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The Big Challenge for Finland after 2008
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Finnish Exports up to EUR 20 – 30 Billion Short of Annual Target Level
28 27 26 17 16 15 14 13 12 11 10 25 24 23 22 21 20 19 18 Export of goods and services by quarter, billion euros, at current prices
2005 2006 2007 2008 2009 2010 2011 2012
Working day and seasonally adjusted index.
Latest information July-September 2013. Source: Statistics Finland / National Accounts
2013
Exports needed to avoid extra running into debt in the public sector Exports, realized 28.4.2020
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Finnish Exports lagging Behind Competitors
230 220 210 200 190 180 170 160 150 140 130 120 110 100 90 Export of goods and services by quarter, billion euros, at current prices, index
2005,I = 100 2005 2006 2007 2008 2009 2010
Working day and seasonally adjusted index.
Latest information July-September 2013. Source: Eurostat
2011 2012 2013
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Estonia Poland Chech Republic Germany The Netherlands Belgium Sweden Finland
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Finland not attracting Companies ’ Investment
Companies ’ Fixed Investments in Different Countries
140
Indeksi, 2005=100 Germany
135 130 125
Netherlands
120 115 110 105 100 95 90 2005 2006 2007 2008 2009 2010 2011 2012 2013e 2014e 2015e
Sweden USA Switzerland Finland Source: OECD, Economic Outlook, November 2013 28.4.2020
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Unit Labour Costs at the National Economy Level
(Including the Effective Exchange Rates)
120 2005,I =100 115 110 105 100 95 Finland’s cost competitiveness declines Finland’s cost competitiveness improves 90 2005 2006 2007 Compared to Germany Compared to the Netherlands 2008 2009 2010 Compared to Spain Compared to Austria 2011 2012 2013 Compared to Italy 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 II/2013. Source: European Central Bank 28.4.2020
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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 28.4.2020
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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 28.4.2020
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