The role of immigrant entrepreneurship in Finland’s employment and productivity dynamics of firm growth and restructuring

Abstract

The study examines the growth of real value added, employment, and labour productivity in firms with an immigrant background in Finland between 2007 and 2016. The analysis uses Statistics Finland’s so-called FLOWN dataset, which enables the linkage of register-based data on firms, their owners, and employees.

The share of firms with an immigrant background in the business population has been a few percent, and their share of employment in the business sector has been of the order of one percent. Their impact on Finland’s aggregate economic and employment growth is therefore necessarily limited.

However, the growth of real value added in immigrant-background firms has been clearly faster than in other firm groups. Job creation rates in these firms have been exceptionally high, but job destruction rates have nevertheless been at a similar level as in domestically owned local firms.

Immigrant-background firms have created a relatively large number of low-productivity and low-wage jobs. Wage growth in these firms has, on average, been faster than in others, but cyclical wage fluctuations have been more pronounced than elsewhere. (AI translation)

Publication Information

Maliranta, M., & Nurmi, S. (2019), Maahanmuuttajien yritystoiminnan merkitys Suomen työllisyyden ja tuottavuuden yritysdynamiikalle, Kansantaloudellinen aikakauskirja, 115(2), 289–316.

• ISSN: 0022-8427