Highly Skilled Labor Force in the Global Field of Choices: Case Finland

Highly Skilled Labor Force in the Global Field of Choices: Case Finland

Mika Raunio, Senior Researcher & Markku Sotarauta, Professor

University of Tampere
Research Unit for Urban and Regional Development Studies (Sente)
FIN-33014 University of Tampere
Finland
markku.sotarauta@uta.fi
+ 358 40 523 3517
+ 358 3 215 8860, fax


Paper presented by prof. Sotarauta at
Oxford Round Table
“Adapting to Globalization in the 21st Century”
St. Antony’s College
University of Oxford, England
July 31 – August 5. 2005



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Highly Skilled Labor Force in the Global Field of Choices: Case Finland

1 Attracting Global Economy’s Experts to Finland
1.1 Point of departure
The 90’s was a watershed in the development of the Finnish economy. Finland began the
decade with a severe economic depression, marked its middle by joining the European Un-
ion, and found itself in the end of the decade as one of the most competitive economies not
only in Europe but in the world (Werner, 2003, 1). At least for now, restructuration has re-
sulted in significant increases in growth rates, high-tech exports and national wealth. In in-
ternational comparisons, Finland’s economy steadily emerges as innovative and highly
competitive. Its recovery is in considerable part attributable to developments in the informa-
tion and communication technology (ICT) sector (Rouvinen & Ylä-Anttila, 2003, 87).
However, the population of Finland is ageing rapidly and the dependency ratio is wea-
kening more steeply than in the OECD countries in average, and what makes situation worse
is that the country is not attracting foreign talents as hoped for. There is a growing foreign
population in Finland, but the percentage is still relatively low compared to other European
countries. Immigrants represent only about 1.7 % of the population, while the proportion in
Sweden, the Netherlands and United States is at least 10 %. This fact is reflected at the uni-
versities too, for example, foreign students represent about 6 % of all doctoral students in
Finland, while their share is more than 15 % in the UK, Belgium, the USA, Sweden, Austra-
lia and Sweden (Making Finland… 2005, 6-7.) The low numbers are especially striking in
the case of foreign professional work force. According to International Standard Classifica-
tion of Occupations (ISCO), which defines skills in terms of skill level and skill specialisati-
on, the share of non-nationals in employment in professional occupations is quite modest in
Finland when compared with other North European countries (table 1). In managerial occu-
pations European average is even ten times bigger and in professional occupations five times
bigger than in Finland.







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Table 1. Share of non-nationals in employment in different occupations in EU countries 1998 (Auriol &
Sexton 2002)


Aus Belg Ger DK Spa Fin Fra Gre Ita Lux Net Por Swe UK Total
Managers1
5,0 10,1 7,7 2,7 1,5 0,4 4,7 0,9 1,1 44,7 2,5 1,4 2,3 4,2 4,3
Professionals2
6,0 5,0 4,0 2,4 1,0 0,6 2,6 0,9 0,7 33,4 2,6 1,7 3,2 4,5 3,1

There indeed are many issues challenging the so far successful “Finnish model”, and only
time will tell how resilient Finland will be in the near future. What is sure is that the new
challenges are enough to turn policy-makers’ hair grey once again.
In this paper we ask how Finland is able to attract and retain foreign professionals into
Finnish working and living environments. Although this paper focuses on professionals in
ICT-industry, it provides a wider picture of Finland and its industries abilities to attract la-
bour force in immediate future. The approach is critical and selective in order to point out
the major development needs and issues that weaken the attractiveness of Finland from the
foreign professionals’ point of view. This paper focuses on working and living environments
in general and thus more specific questions about work permits and other regulatory issues
are not scrutinized here.
Defining the target group as “global economy’s experts” refers not only to applied exper-
tise but also to the capability to seek job opportunities globally. Definition of the target
group by professional expertise is essential here as many regulations on (work) permits ap-
pertaining to availability concern specific fields. In addition, enterprises in the global econ-
omy's network and the channels they have created are also connected to the structure of the
certain lines of business. Moreover, the rapid growth in the field of ICT during the last 15
years or so served to set in motion a migration of global economy's nomads and is a contrib-
uting factor in the genesis of the new "fusion culture". Fusion culture refers to lower barriers
in interaction between different cultures due to common values and mind-sets obtained from
international and multicultural working and living environments. In addition, growing cul-
tural competence is increasingly characteristic for individuals working in international and
multicultural environments and especially for those working abroad.

1 ISCO 1: Production and operation department managers. Other (including computing services) department managers. General managers.
2 ISCO 2: Physical, mathematical and engineering science professionals. Life science and health professionals. Teaching professionals. Other professionals.
ISCO 3: Physical and engineering science associate professionals. Life science and health associate professionals. Teaching associate professionals. Teaching
associate professionals. Other associate professionals.

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1.2 The research questions, process and target group
This papers aims to analyze the key issues in attracting and retaining foreign professionals in
Finnish working and living environments. The key questions are: a) what are the images of
foreign professionals of Finnish firms and Finland in general as a place to work and live? b)
what are the real-life experiences of foreign professionals of Finnish firms and Finland in
general as a place to work and live?
The data is based on 122 interviews out of which a) 30 were background interviews (the
people responsible for the recruiting foreign professionals, relocation consultants, managers,
HR-personnel and the personnel dealing with these issues in public organizations of urban
regions, b) 59 were interviews with foreign professionals and c) 33 were interviews with
their (foreign) spouses. Spouses were interviewed in order to enhance the understanding of
the pros and cons emerging in the everyday lives of foreign families/couples. In addition a
survey in the Internet for foreign professionals working in Finland was carried out (n=556).
Respondents in the survey were mostly in the field of ICT but 2 percent of them work in the
field of biotechnology. The aim was to find out whether foreign professionals are satisfied or
not satisfied with their situation and what factors affect the prevailing level of satisfaction.
The city-regions where data was gathered were city-regions of Helsinki (including Espoo),
Tampere, Turku (including Salo) and Oulu (Figure 1).

Oulu region
170 000
Tampere region
285 000
Turku
Helsinki
region & Salo
region (Espoo)
276 000 25 000
1 150 000

Figure 1. Finland in Europe, study regions in Finland and number of inhabitants

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The views of the respondents are mostly based on a fairly long time spent in Finland. Al-
most half of the respondents had lived in Finland for at least three years. Typical profile of
respondent was 34 years old European (65 %) male (80 %) with higher education (94 %)
who works in Finland with local contract (85 %) and lives with his family or spou-
se/cohabitant (69 %).
2 Finland in the global field of choices
The attractiveness of urban region may be estimated according to its position in target
groups’ field of choices. The field of choices of international professional labor force con-
sists of those opportunities that they perceive and consider as potential places to work and
live. In persuasion of the professional labor force the competitiveness can be seen as attrac-
tiveness and a competitive advantage as an ability to attract and retain human resources mo-
re efficiently than other parties pursuing the same target group. Attractiveness does not only
attract (pull) but it also retains (commit). The environment and the elements of attractiveness
are here allocated into five basic elements:
• Creative problem solving environment (interesting and challenging job opportunities, size of the
labor markets, working culture, etc.)
• Economic environment (salaries, tax-level, costs of living, etc.)
• Functional environment (public and private services, access to place, etc.)
• Social environment (friends and relatives, social networks, international atmosphere, etc.)
• Physical living environment (housing conditions, natural environment, safety, etc.)
According to this study and earlier migration related studies, global economy’s experts can
by way of simplification be divided into three groups according to their moving motives:
• Global economy's nomads3 consider moving if work and career opportunities which are more
tempting than at present should emerge. Global economy's nomads move from one country to
another in periods of one year or several years. Their objective is not to integrate into the local
culture but rather into its own global culture.
• Quality of life -migrants consider moving if it is assumed that some other area offers a clearly
superior quality of life or an environment corresponding more closely to the desired way of life
than their present domicile. These people are seeking for a permanent place to stay and their ob-
jective is to integrate into the local culture.
• Social relations migrants have a motivation to integrate dependent on the intended perma-
nency of the move, i.e. in the last instance on the individual or community which has been the
main motivation for moving. Moving is considered if social relations deemed important or fam-
ily ties are beyond the present place of domicile or about to move there (e.g. highly educated
spouses).

3 See Trux 2002.

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Nomadic life-style in the global economy is rendered possible by global applicability of pro-
fessional labor force's skills and knowledge and a “network of global economy”, which sup-
ports mobility of skilled labor. For example, in the field of ICT and biotechnology expertise
can frequently be applied throughout the world, which gives the individual an opportunity to
make employers compete internationally for the most interesting and challenging jobs. Mo-
bility in the field of choices is increased by the internationalization of experts and the
changed dynamics of the labor markets, in which no commitment is made to a single job or
employer for as long a period as was formerly the case. The career consists of numerous epi-
sodes and changing jobs is a part of career development and way of life. Mobility is also
emphasized at certain phases of life for global economy's experts. The nomadic life-style
and appreciation of a more permanent domicile varies as the family relations and life situa-
tions of the individual vary.
It should be acknowledged, that general preferences for the location choice are much
more diverse than those factors that actually determine the final decision (see Figure 2). In
most cases main motives and pull factors when choosing the certain location are work or
family related issues, whereas other factors works more or less as preventing forces if per-
ceived to be very low quality. In the case of Finland, it seems that a move occurs primarily
from one job to another, not from one country to another.

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Non-racist image of public offices and civil servants of the country in general (N=546)
67,8
23,1
7,3
Safety of the area (N=539)
63,8
29,7
5,9
Communicative working culture (N=550)
62,7
31,8
4,0
Challenging and interesting work (N=550)
62,4
33,8
Well organised public services ( health care, public transport) (N=543)
56,2
37,9
5,7
The chances for spouse to work and/or study (N=534)
55,8
24,2
14,4
An international atmosphere (attidudes towards foreigners, multiculturalism, etc.) (N=548)
54,2
31,6
11,9
A clean and unpolluted living environment (N=543)
52,9
40,9
6,1
Good career prospects (N=549)
47,8
40,5
9,1
High level of economic wellbeing (wage level in relation to taxes and living costs) (N=542)
43,4
45,2
10,3
An open and approachable social atmosphere of the host culture (N=542)
43,2
47,2
8,3
Being able to manage with English (outside work) (N=547)
42,8
37,7
14,6
4,2
Salary and other financial incentives (N=548)
41,0
47,7
9,5
High quality of housing available (N=543)
40,9
51,6
7,0
Versatile leisure time activities and recreational facilities (N=549)
32,1
49,5
16,4
International flight connections to and from the place (N=541)
31,4
38,1
23,7
6,3
The local tax rate (N=547)
28,9
43,7
23,0
4,0
Pension benefits (N=546)
27,8
33,5
22,7
11,2
4,8
Friends or an existing social network at the destination (N=542)
26,4
30,8
29,9
11,8
Sophisticated "high-tech" culture (internet and mobile services, high tech oriented people, etc.) (N=542)
23,6
40,6
27,1
8,5
Non-hierarchical working culture (flat organisation) (N=551)
19,2
41,7
22,1
9,3
7,6
The opportunity to study at the university level (basic studies or post graduate) (N=545)
19,1
28,8
28,3
18,0
5,9
A chance to work for a particular employer (N=542)
18,3
33,8
27,7
15,9
4,4
Cultural activities (opera, museums, art exhibitions, theatre, etc.) (N=541)
15,7
39,9
34,8
7,6
Lively night life (clubs, discos, movies, etc.) (N=548)
9,3
24,3
41,4
23,7
0 %
20 %
40 %
60 %
80 %
100 %
very important
quite important
a little important
not important at all
can not say

Figure 2. Importance of factors when choosing a place to live and work internationally

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The job has been landed before moving to the country, i.e. people do not move to a region
offering interesting job opportunities and look for work there; it just so happens that the in-
teresting job is located in the region. This dynamics is more pronounced in the case of
Finland, since the general images are not particularly strong and/or attractive. Exceptions to
this are those whose move is based on social relations or in most cases more specifically
family reasons. In addition, the experts did include to some extent those seeking a change
for quality of life, but in most cases their main reason for moving was either former experi-
ence of Finland or economic reasons. In the case of the latter some came to this country un-
der special contracts in which the salary was higher than local salaries. Thus, the decision to
move in both groups stressing the quality of life was in most cases linked not to an attractive
image of Finland but to former experience and more often financial benefits.
One could say that the global economy's network from the perspective of the expert con-
sists of expertise intensive enterprises or other organizations recruiting internationally and
their regional concentrations. In this network formed by organizations providing job oppor-
tunities experts move along routes created by states, regions and firms. Increased interactiv-
ity and the connections between the nodes of the network have the effect of “shrinking” dis-
tances within the global economy network both in respect of time and of culture. This is
seen in the habit of global experts of conceiving of the world and forming images of the sur-
rounding reality. Internationally mobile experts do not perceive the world to consist of na-
tion-states and cities only, but rather increasingly of a global economy's network; network of
nodes consisting centers of their own particular expertise and job markets. Such an image is
frequently consciously formed when working in an international environment and especially
when the individual considers an international move as a personal opportunity.
Thus, in a pointed way the competition takes place in the global field of choices of pro-
fessionals, where global network consists of labor markets provides the base for the field
and emerging attracting opportunities. Two main methods of seeking a new job were: con-
tacting friends or people met through work (professional contacts) and searching the Inter-
net. This intensive use of various social and virtual networks is rather characteristic of mi-
grants and is certainly a result of global corporations' world wide operations and profes-
sional contacts from which such opportunities can be derived. Although personal relation-
ships are still very important when professionals seek work from global field, the impor-
tance of Internet constantly grows. About one third of respondents perceived opportunities
of Finland through Internet. Through these channels Finland and its urban regions and firms

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may enter into field of global competition for professionals, or with other words into profes-
sionals’ global field of choices.
3 Elements of Attractiveness
3.1 Creative problem-solving environment
Foreign professionals working in Finland found their work interesting and challenging. In
addition, despite the modest amount of social interaction the Finnish working atmosphere
was felt to be pleasant and less competitive than in many other countries. In working life the
point of departure is not the pursuit of individual interests by tripping others up. This view
fits with Hofstede’s (1991) interpretation of Finland as a country of feminine culture. In fe-
minine cultures (the Netherlands, Sweden, Denmark etc.) the ethos is “work in order to li-
ve”, whereas in masculine culture (USA, Japan, Italy etc.) it is “live in order to work”. In a
masculine culture the boss seeks a friend for work, not work for a friend. The goal of a mas-
culine culture is a performance society, whereas the goal of a feminine culture is a welfare
society. (Hofstede 1991, 94-97.) Many of the interviewees emphasized the family friendly
character of the Finnish working life in long holidays which can be taken as agreed, working
days which generally end at 5 p.m. and the option of staying at home with a sick child etc.
Compared to many other Finnish cultures working life does a great deal to meet the individ-
ual and his/her family half way.
My current job is very interesting and
39,4
42,1
12,5
5,4
challenging (N=554)
The working culture is non-hierarchical
and it is easy to approach my superiors
38,8
42,4
11,9
5,2
(N=554)
I prefer my current employer to others
37,4
39,1
20,4
(N=548)
My current home region offers
sufficient work and/or study
28,1
21,4
32,9
10,0
7,6
opportunities for my spouse (N=501)
The working culture in my unit is
21,6
44,2
19,2
11,2
3,8
communicative (N=552)
Career prospects in my current home
14,7
40,0
28,6
13,0
3,6
region are good (N=552)
0 %
20 %
40 %
60 %
80 %
100 %
strongly agree
mostly agree
neutral
mostly disagree
strongly disagree

Figure 3. Satisfaction with factors of the work environment in Finland among foreign highly skilled
working in Finland

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What especially required adjustment were the Finnish communication culture and the mode
of interaction between people. The absence of the discussion culture is connected both to
business processes or the individual’s ability to participate and utilise his/her knowledge as a
part of the organization and teams and also his/her personal integration into the work com-
munity. By learning the interaction methods of the work community the individual also has
better chances of utilizing his/her knowledge as a part of a greater whole. This naturally
does not concern only foreigners, but the phenomenon is emphasized when different cultural
communication and interaction methods come to the fore in a multicultural work commu-
nity. The prominence of the phenomenon opens up opportunities for the development of the
communication and interaction methods of the entire (work) community by using exagger-
ated disparities between cultures as a starting point for the development process.
Poor communication and interaction possibly also inhibits commitment to a work com-
munity and thereby the preconditions for engendering social capital based on trust and close
interaction. Thus communication does not only affect the contentment and working effi-
ciency of individuals, but also their chances of participating and making their contribution to
the key processes of business and competitiveness in general.
Thus, regardless some problems in communication, there is satisfaction with the quality
of work and the general atmosphere. However, the prospects for advancement and career are
not perceived to be equally positive. The employment prospects of foreign spouses in par-
ticular are seen to be poor (Figure 3). Chances for advancement and career are limited not
only by the fairly small job markets in Finland but also by the fact that many companies are
not used to hiring foreign workers. Chances for advancement are linked to opportunities
within the companies whereas career opportunities can be seen more widely from the per-
spective of the job markets for the field as a whole as interesting and challenging openings.
3.2 Work and career opportunities
The foreign workers frequently perceived their chances of advancing in their careers within
the company as slightly poorer compared to those of their Finnish colleagues. In some cases
the respondents even took it for granted that when the choice is between a Finn and a for-
eigner for promotion it is the Finn who will be preferred almost without exception. The rea-
son for this was considered to be the existing social networks in which people who are al-
ready acquainted with one another select each other as subordinates. The “Finn-boy bias”
was seen in some top/middle management selections (vertical career path) to be clear, but in

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