Over the next couple of years, retail sales growth in Finland will be mainly driven by rising prices, according to Kaupan Liitto (the Confederation of Finnish Trade Unions).
Rising prices of raw materials and energy will contribute to price increases, the trade body noted.
In 2021, the euro-denominated turnover in retail trade increased by almost 5% in Finland, and the volume of turnover adjusted for price fluctuations grew by about 3%.
During the fourth quarter, revenue declined and rising prices boosted sales growth. A steep increase in wholesale prices and energy costs resulted in higher trade costs and eroded revenue growth towards the end of the year.
Jaana Kurjenoja, chief economist of Kaupan Liitto, commented, “The effects of availability and logistics problems, as well as the prices of raw materials and energy, are only now beginning to be fully reflected in wholesale and retail prices.”
The trade body also forecast that retail sales growth will slow down in 2022, to about 1%–1.5%, compared to growth seen during the pandemic.
Over the next couple of years, the volume of net sales is not expected to grow much, and the growth of euro-denominated net sales will be based on a cost-price spiral.
Impact On Employment
Kaupan Liitto highlighted that retail employment will return to a declining trajectory after the pandemic.
Competition in the wholesale and retail sectors has increased the need to streamline operations and cut costs, both globally and at a national level.
It has been implemented through digitalisation, automation of operations, development of logistics, shortening of supply chains and procurement cooperation, among others.
“Despite the development, trade is by far the largest employer in the corporate sector. If trade is to continue to employ Finland, tax policy should support purchasing power and curb employment costs,” Kurjenoja added.
In 2021, employment increased by around 20,000 in the grocery and speciality trade segments as the pandemic boosted demand for labour in retail.
In contrast, 9,000 people in the retail sector lost their jobs in 2019, and about 15,000 in 2020.