Development options for the income requirement for those coming to Finland with a residence permit and their impacts

Abstract

The report examines the options for developing the income requirements for immigrants coming to Finland with residence permits and the potential impacts of these options. Based on a comparison of different countries’ models and previous research literature, the report assesses alternative models (besides the mechanism based on income thresholds) that could be used in Finland to implement the principle of secured livelihood for labour migrants from third countries, individuals immigrating for family reunification, and students. A retrospective and causal analysis evaluate the effects of lowering income thresholds on the number and composition of immigrants. Furthermore, the report explores the potential societal and economic impacts of easing these thresholds. The quantitative analyses in the report utilize register data from Statistics Finland, and calculations of net fiscal impacts are performed using the SISU microsimulation model.

The report assesses that the greatest need for reform is related to the income requirements for family-related residence permits. Several alternative reform options are proposed, such as adjusting income thresholds for children to better reflect the economies of scale from cohabitation or removing income thresholds for very young children. For work-based residence permits, an income threshold requirement would remain the main principle, but the model could be made more flexible for highly skilled workers.

Both the retrospective and causal analyses support the conclusion that lowering income thresholds would increase the number of immigrants while also changing the composition of the immigrants.

Publication information

Kauhanen, M., Nyyssölä, M., Carnicelli, L., Kanninen, O., Kiviholma, S., Nieminen, J. & Isotalo, E. (2024), Development options for the income requirement for those coming to Finland with a residence permit and their impacts, Publications of the Government´s analysis, assessment and research activities 2024:34.

• ISSN: 2342-6799 (Online)
• ISBN: 978-952-383-443-9 (Online)