The City of Helsinki is overhauling its pay subsidy model, introducing its own employment allowance alongside the pay subsidy system. Since the beginning of this year, the City has been responsible for employment services and cannot therefore pay a pay subsidy to itself.
However, Helsinki wants to continue to provide its unemployed jobseekers with employment relationships that are as long-term as possible. Because of this, the City is introducing its own employment allowance to replace the pay subsidy system.
"As a responsible employer, Helsinki is providing unemployed residents facing employment challenges with work in duties that have a feasible path towards further employment", explains Head of Unit Risto Rantala from Helsinki Employment Services.
The duration of an employment relationship with the City’s employment allowance is 12 months. The objective is for Helsinki to use it for duties in which work would continue after the subsidised period.
Recruitments utilising the employment allowance can begin in mid-January.
"This is an impactful new tool for supporting the employment of Helsinki residents who have been unemployed for a longer time", Rantala continues.
Helsinki is not abolishing the pay subsidy system completely. Pay subsidies will continue to be granted in the Social Services, Healthcare and Rescue Services Division.
Additionally, the City will continue offering a pay subsidy to private employers and third-sector operators. These subsidy forms are supplemented by the Helsinki benefit, which is a discretionary subsidy granted for hiring an unemployed Helsinki resident to work for a private or third-sector employer.
"The pay subsidy has been shown to be an effective employment promotion method particularly when targeted at private-sector businesses", Rantala points out.
The City of Helsinki has also had good experiences with the pay subsidy system. It has been of significant help, particularly in the Education Division and the Culture and Leisure Division.
With this overhaul, the City wants to preserve its tried-and-true employment promotion methods while also seeking new, even more effective solutions.
