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WRAPUP 1-Finnish minister urges job protection as companies struggle
February 5, 2014 / 3:26 PM / 4 years ago

WRAPUP 1-Finnish minister urges job protection as companies struggle

* Finnish business survey indicates weak outlook

* Disappointing Q4 results from engineering sector

* November GDP drops 1.1 pct year-on-year

* Minister says govt must protect jobs in state-owned firms (Wraps business survey, company results and GDP data, adds minister comments)

By Jussi Rosendahl

HELSINKI, Feb 5 (Reuters) - A Finnish minister said the government must help to protect jobs in major state-owned industries as manufacturers struggle with weak European demand and increased competition.

Lay-offs at Finnish companies as well as the planned takeover of state-owned steel company Rautaruukki by Swedish rival SSAB have prompted unions to call on the government to do more to secure jobs.

“In the limits of the legislation, the state must ... look at the overall benefits of its holdings and investments, including employment and regional policy...,” Pekka Haavisto, a minister in charge of overseeing state investments, said in a column in the Helsingin Sanomat newspaper.

Economic data and disappointing fourth-quarter company results have underscored the weak conditions facing many businesses.

Finland’s traditional manufacturers of paper, machines and ships have been hit by a prolonged downturn in Europe as well as tougher global competition. Altogether about 100,000 industrial jobs have been lost over the last 10 years.

Companies expect weak business conditions to persist in the first half of the year, a survey by the Confederation of Finnish Industries (EK) showed on Wednesday. Separately, the statistics office said the economy shrank 1.1 percent in November from a year earlier, more than expected.

“No major improvement to the general business outlook is expected early this year. The current situation for all sectors is below average. The order books for most companies were small, with a lot of capacity free,” EK said in a statement.

Crane maker Konecranes, one of the country’s biggest engineers, reported weaker-than-expected fourth-quarter results and said on Wednesday that market conditions were so uncertain it could not give a full-year sales forecast.

The Finnish state plays an unusually big role as an investor in some of the country’s biggest companies. It owns large stakes in 15 Helsinki-listed firms such as paper firm Stora Enso , operators TeliaSonera and Elisa , insurer Sampo and utility Fortum . It also fully owns 44 other companies. (Editing by Louise Ireland)

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