The technology industry is comprised of five sub-sectors in Finland: electronics and electrotechnical, mechanical engineering, metals, information technology, and consulting engineering. It employs almost 290,000 people directly and 720,000 in total, accounting for 30% of Finland's labor force. While the industry exports over half of Finland's total exports, it has faced declining turnover and new orders in recent years amid structural changes in the economy.

1. The Federation of
Finnish Technology
Industries
December 2013

2. 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...
Mechanical
Engineering
Abloy, Cargotec, Fiskars,
Glaston, Kone, Konecranes,
Metso, Normet, Oras, Patria,
Pemamek, Ponsse, Prima
Power, Stala, STX Finland,
Valtra, Wärtsilä...
Metals Industry
Boliden, Componenta, Kuusakoski,
Luvata, Norilsk Nickel, Outokumpu,
Outotec, Ovako, Rautaruukki,
Sacotec…
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…
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3. 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
Information Technology
Mechanical Engineering
• Machinery, metal products,
vehicles
• Turnover (2012): 27.9 billion euros
• Personnel (30.9.2013): 129 100
• 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
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3

4. The Technology Industry –
the Most Important Sector in Finland
• 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
some 1,600 member
companies.
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4

5. Turnover of the Technology Industry in Finland
34
32
30
28
26
24
22
20
18
16
14
12
10
8
6
4
2
0
Billion euros,at current prices
Metals industry
Mechanical engineering
Electronics and electrotechnical
industry
Information technology
Consulting engineering
2005
2006
2007
2008
2009
Source: Statistics Finland
2010
2011
2012
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6. 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 %
North America
2.2 billion €
8.2 %
Central and Eastern Europe
5.3 billion €
20.2 %
the Middle East
0.6 billion €
2.3 %
South and Central America
1.5 billion €
5.5 %
Africa
0.8 billion €
3.0 %
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
11.12.2013
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7. Turnover of the Industry and Technology Industry
in Finland
150
2005 = 100
Change: 1-8, 2013 / 1-8, 2012, %
140
130
Industry
-4 %
120
110
Technology
industry
100
-6 %
90
80
2005
2006
2007
2008
2009
2010
2011
2012
2013
Seasonally adjusted turnover index, latest information 8/2013.
Source: Statistics Finland
11.12.2013
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8. Turnover of the Technology Industry in Finland
200
2005 = 100
Change: 1-8,2013 / 1-8,2012, %
190
180
Information technology
170
+13 %
160
Consulting engineering
150
+4 %
140
130
Mechanical engineering
120
-7 %
110
Metals industry
100
-7 %
90
80
Electronics and electrotechnical
industry
70
60
-14 %
50
2005
2006
2007
2008
2009
2010
2011
2012
2013
Seasonally adjusted turnover index, latest information 8/2013. 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
11.12.2013
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9. 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
2006
2007
Change:
Export:
Domestic:
Combined:
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
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10. Value of Order Books in the Technology Industry* in
Finland
Million euros, at current prices
24000
22000
20000
18000
Combined
16000
Export
14000
12000
10000
Domestic
8000
6000
4000
2000
0
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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11. 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 %
Median: 0 %
0%
Average: -10 %
-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
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12. 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
Combined
Export
Domestic
2005
2006
Change:
Export:
Domestic:
Combined:
2007
2008
2009
2010
2011
III,2013 / III,2012
-51 %
-10 %
-48 %
2012
2013
III,2013 / II,2013
-42 %
-11 %
-39 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information July-September 2013
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13. 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
Combined
Export
Domestic
2005
2006
Change:
Export:
Domestic:
Combined:
2007
2008
2009
2010
30.9.2013 / 30.9.2012
-43 %
-18 %
-41 %
2011
2012
2013
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
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14. Value of New Orders in the Mechanical Engineering in
Finland
5000
Million euros, at current prices
4500
4000
3500
Combined
3000
Export
2500
2000
Domestic
1500
1000
500
0
2005
Change:
Export:
Domestic:
Combined:
2006
2007
2008
2009
2010
2011
III,2013 / III,2012
+4 %
-8 %
+1 %
2012
2013
III,2013 / II,2013
0%
-26 %
-7 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information July-September 2013
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15. Value of Order Books in the Mechanical
Engineering in Finland
Million euros, at current prices
15000
14000
13000
12000
11000
10000
9000
8000
7000
6000
5000
4000
3000
2000
1000
0
Combined
Export
Domestic
2005
Change:
Export:
Domestic:
Combined:
2006
2007
2008
2009
2010
30.9.2013 / 30.9.2012
+5 %
-5 %
+3 %
2011
2012
2013
30.9.2013 / 30.6.2013
+1 %
+1 %
+1 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 30.9.2013
11.12.2013
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16. 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
Combined
Export
Domestic
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 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information July-September 2013
11.12.2013
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17. Value of Order Books in the Consulting
Engineering in Finland
Million euros, at current prices
600
550
Combined
500
450
400
Export
350
300
250
Domestic
200
150
100
50
0
2005
Change:
Export:
Domestic:
Combined:
2006
2007
2008
2009
2010
30.9.2013 / 30.9.2012
-3 %
+22 %
+16 %
2011
2012
2013
30.9.2013 / 30.6.2013
-13 %
-3 %
-5 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 30.9.2013
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18. Value of New Orders in the Information
Technology in Finland
800
750
700
650
600
550
500
450
400
350
300
250
200
150
100
50
0
Million euros, at current prices
2005
2006
Change:
Combined:
2007
2008
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
11.12.2013
18

19. Value of Order Books in the Information
Technology in Finland
Million euros, at current prices
2000
1800
1600
1400
1200
1000
800
600
400
200
0
2007
Change:
Combined:
2008
2009
2010
2011
2012
2013
30.9.2013 / 30.9.2012 30.9.2013 / 30.6.2013
-3 %
-2 %
Source: The Federation of Finnish Technology Industries’ order book survey’s respondent companies,
latest information 30.9.2013
11.12.2013
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20. Personnel in the Technology Industry
Some 15 000 of
employees affected
by temporary or
part-time lay-offs
340 000
320 000
300 000
280 000
260 000
240 000
220 000
200 000
180 000
160 000
140 000
2008
2009
Personnel in Finland
2010
2011
2012
2013 (30.9.)
Personnel in subsidiaries abroad
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force
survey
11.12.2013
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21. 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
Information technology
Electronics and Electrotechnical Industry
Consulting engineering
Source: Statistics Finland, The Federation of Finnish Technology Industries’ labour force survey
11.12.2013
21

22. Retirement of Technology Industry Personnel
9000
Individuals per year
8000
7000
6000
5000
Salaried employees
4000
3000
2000
Blue collar employees
1000
0
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
2022
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
11.12.2013
22

23. 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
Mechanical engineering
Metals industry
Electronics and electrotechnical industry
Source: Wage inquiry of the Federation of Finnish Technology Industries, Finnish Centre for
11.12.2013
Pensions, Statistics Finland
23

24. 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 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 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.
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25. European recovery will
take time
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25

26. Industrial Production Volume
Industrial production volume in EU countries 10 %,
but in Finland 19 % lower since early 2008
110
2008=100
105
USA
100
95
EU28
countries
90
Japan
85
80
Finland
75
70
65
2008
2009
2010
2011
2012
2013
Seasonally adjusted volume index, latest information 9/2013 or 10/2013.
Source: Eurostat, Federal Reserve (USA), Statistics Bereau and Statistics Center
11.12.2013
(Japan)
26

27. Industrial Production Volume in EU Countries
125
2008=100
120
Poland
115
Estonia
110
Belgium
105
Austria
100
Germany
95
Sweden
90
Finland
85
Italy
80
Spain
75
70
2008
2009
2010
2011
2012
Seasonally adjusted volume index, latest information 9/2013.
Source: Eurostat
2013
11.12.2013
27

28. 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
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28

29. Breakdown of World Industrial Production
%
50
45
40
Asia
35
30
North America
25
20
15
Europe
10
5
0
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010
Purchasing power parity adjusted shares.
Source: Maddison (Historical Statistics), IMF and ETLA
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29

30. Industrial Production Development by Year
320
China
300
280
Korea
260
India
240
Russia
220
200
Finland
180
Brazil
160
140
USA
2005=100
120
Euroarea
100
Japan
80
2005
2006
2007
2008
2009
2010
2011
2012
2013e 2014e
Source: Consensus Economics
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30

31. Almost all Western Countries have Excessive
Public Debt
Public debt / GDP, %
210
200
190
180
170
160
150
140
130
120
110
100
90
80
70
60
50
40
30
20
Greece
Italy
Irland
Portugal
USA
Belgium
Germany
Spain
Finland
Sweden
2005 2006 2007 2008 2009 2010 2011 2012e 2013e 2014e
Source: OECD, Economic Outlook, May 2013
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31

32. The Big Challenge for
Finland after 2008
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32

33. Finnish Exports up to EUR 20 – 30 Billion Short of
Annual Target Level
28
27
26
25
24
23
22
21
20
19
18
17
16
15
14
13
12
11
10
Export of goods and services by quarter, billion euros, at current prices
Exports needed to
avoid extra running
into debt in the
public sector
Exports, realized
2005
2006
2007
2008
2009
2010
Working day and seasonally adjusted index.
Latest information April-June 2013.
Source: Statistics Finland
2011
2012
2013
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34. Finnish Exports lagging Behind Competitors
230
Export of goods and services by quarter, billion euros, at current prices, index
220
210
Estonia
200
190
Poland
180
Chech
Republic
Germany
170
160
Netherlands
150
Belgium
140
130
Sweden
120
Finland
110
100
2005,I = 100
90
2005
2006
2007
2008
2009
2010
Working day and seasonally adjusted index.
Latest information April-June 2013.
Source: Eurostat
2011
2012
2013
11.12.2013
34

35. Finland not attracting Companies’ Investment
Companies’ Fixed Investments in Different Countries
Indeksi, 2005=100
135
Germany
130
125
Switzerland
120
Sweden
115
110
USA
105
Belgium
100
95
Finland
90
2005
2006
2007
2008
2009
2010
2011
2012e
Source: OECD, Economic Outlook, May 2013
2013e
2014e
11.12.2013
35

36. Unit Labour Costs at the National Economy Level
(Including the Effective Exchange Rates)
120
2005,I =100
115
Finland’s cost
competitiveness
declines
110
105
Finland’s cost
competitiveness
improves
100
95
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.
36
11.12.2013
Source: European Central Bank

37. 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
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37

38. 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
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38