Economic dependency ratio 

Updated: 11.12.2015 - Next update: 19.2.2016
   
 
 
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Economic dependency ratio weakened in 2013


According to the data of Statistics Finland's employment statistics for the year 2013, the economic dependency ratio weakened by five from the previous year. In 2013, there were 137 non-employed persons per one hundred employed persons, while one year earlier the figure was 132. In the period 1987 to 2013, the dependency ratio was highest in the year of recession 1993 (172) and lowest in 1989, when there were 112 non-employed persons per one hundred employed persons.

The economic dependency ratio is calculated by dividing the number of unemployed, pensioners and other inactive population by the number of employed persons and by multiplying the figure obtained by one hundred. A fall in the economic dependency ratio is thus regarded as positive and a rise as negative. In addition to variations in economic cycles and development of employment, the economic dependency ratio is affected by the birth rate, population structure and migration.

Regional differences in the economic dependency ratio were large. Åland (106) and Uusimaa (111) had the lowest economic dependency ratios in 2013. The economic dependency ratios were highest in Etelä-Savo (165), North Karelia (169) and Kainuu (177). The economic dependency ratios weakened between 2012 and 2013 in all regions, most in Kainuu, Central Finland and Päijät-Häme. The dependency ratio weakened least in Åland. Between 2003 and 2008, the economic dependency ratio improved all over Finland, after which it has weakened in all regions. In some of the regions, the dependency ratio rose by as many as 20 between 2008 and 2013 (Appendix table 2).

The growing number of unemployed and pensioners particularly raises the economic dependency ratio. According to the employment statistics, the number of unemployed and pensioners has increased by over 100,000 (corrected on 12 March 2015) between 2011 and 2013.

Source:
Statistics Finland / Employment


Description of indicator

Population structure is measured with the so-called economic dependency ratio which gives the numbers of persons unemployed or outside the labour force per one employed persons.

The employed labour force comprises all persons between 18-74 who were employed during the reference week and were neither registered as unemployed jobseekers at the labour exhange office nor undergoing military or non-military service.

The unemployed labour force comprises persons aged 15-74 who were unemployed on the last working day of the year. Data on unemployment are obtained from the Ministry of Labour's register on job applicants.

Persons outside the labour force: 0-14-year-olds, students, pupils, pensioners, conscripts, conscientious objectors and others outside the labour force.

A student or a pupil is a person over 15 who is studying full-time in an educational institution and is neither gainfully employed nor unemployed.

Pensioners comprise all persons who according to the data of the Social Insurance Institution or the Centre for Pensions receive a pension (excl. those receiving family pension or part-time pension) and are not gainfully employed. All persons over 74 are also classified as pensioners. In addition, some persons have been classified as pensioners on the basis of pension income.