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Growth of GDP continued in the second quarter of the year

Calculated at the prices of the reference year 2000, the volume of Finland's gross domestic product increased by 1.9 per cent in the second quarter of 2006 from the previous quarter. Compared with the second quarter of 2005, GDP was up by six per cent. Especially primary and secondary production grew from twelve months back. The growth of the economy was improved by strong increase in manufacturing production. In consequence of the previous year's industrial dispute, a strong increase was recorded in the production of the pulp and paper industry.

The number of working days was three lower than one year previously. Adjusted seasonally as well as for working days, the change in GDP from twelve months earlier was 6.6 per cent.

According to the Flash estimate of GDP compiled by Eurostat, the Statistical Office of the European Communities, in the second quarter of 2006 GDP grew in the EU area by 0.9 per cent from the previous quarter, and was 2.8 per cent up on the corresponding time period of the year before.

Output

Calculated at the prices of the reference year 2000, the volume of value added in agriculture was over 0.5 per cent lower than one year ago. By contrast, output in forestry went up and was nearly 26 per cent greater due to strong growth in market fellings.

The value added of industry was nearly 15 per cent higher than twelve months earlier. In the wood and paper industry, output went up by over 50 per cent in the second quarter of the year. In the previous year, its growth was brought down by an industrial dispute. Output in the metal industry increased by over 12 per cent from one year ago. In other manufacturing, output also grew in the second quarter, by over six per cent.

In the April to June period, the value added of construction increased by just short of four per cent from the year before.

The volume of output in trade was 5.5 per cent higher than twelve months earlier. Output in the transport industry grew by good four per cent in the second quarter of 2006.

Imports, exports, consumption and investments

The output of the national economy was increased in the second quarter of the year by all the demand components: exports, household consumption and investments. The volume of exports grew by over 15 per cent from April to June. Imports were good seven per cent up on the year before.

Private consumption grew by more than three per cent in the second quarter. Purchases of clothing, footwear, furniture and, especially of household appliances and electronics, were plentiful. Consumption of services grew by over four per cent.

Construction investments increased just under five per cent. Housing construction grew by just short of 10 per cent, whereas other building construction contracted by 0.5 per cent. Investments in civil engineering remained on level with the previous year. Investments in machinery and equipment increased by 0.5 per cent, having grown by nearly nine per cent in the quarter before. In the second quarter of the year, private investments went up by more than three per cent and public investments by 0.5 per cent from twelve months earlier.

Employment, wages and salaries and national income

Employment improved in the second quarter of 2006. The number of employed persons went up by 1.9 per cent from the corresponding quarter of 2005. The number of hours worked in the national economy decreased in the second quarter by just under one per cent from the corresponding quarter of 2005. In 2006, the second quarter had three fewer working days than in 2005. According to Statistics Finland's Labour Force Survey, the rate of unemployment for the April to June period was 8.9 per cent. In last year's corresponding quarter it stood at 9.6 per cent. The rate of employment was 69.4 per cent in the second quarter of 2006, having been 68.8 per cent twelve months previously.

In the first quarter of 2006, the nominal wages and salaries bill (excluding incentive stock options) of the national economy grew by 4.5 per cent. Operating surplus, which in business bookkeeping roughly corresponds to business profit, increased by just under 12 per cent. In the second quarter of the year, national income was over eight per cent greater than in the corresponding quarter of the previous year.

The available data

These preliminary data on the second quarter of 2006 are based on information on economic development available by 1 September 2006.

Data at the annual level correspond with the National Accounts data released on 13 July 2006.

Data concerning the third quarter of 2006 will be re-leased on 8 December 2006, when the data for previous quarters will also be revised.

Revised method of calculating value added per quarter

The method for calculating value added in quarterly national accounts has been revised. Value added by industry is now calculated by deducting intermediate consumption from output. In calculations at constant prices output and intermediate consumption are deflated separately, and value added at constant prices is obtained as the difference between these figures. At the same time, fixed base year was replaced with a changing base year, so that the previous year is always the base year but published data are expressed at the prices of the reference year 2000 as chained series (calculated using the average prices of the previous year).

The calculation method makes the value added figures for individual industries highly volatile, and data on the value added generated by an individual industry in a given quarter should be approached with great caution. Thus, the data by industry should be regarded as an interim stage in the calculation, in which the eventual aim is to produce as reliable as possible summed up value added for all industries in the whole economy.

The data contents of quarterly accounts have been re-calculated with the revised method for the quarters of 2000N1 to 2006N2. Quarters older than this have been chained backwards using the previous data and balanced to the new annual levels. The data for 2000-2005 have also been balanced to the new levels of annual accounts.

The data on 2004 and 2005 are preliminary. The data concerning 2005 were revised in connection with the release of annual accounts on 13 July 2006, while the data for 2004 will become finally revised in January 2007. Further information about this national accounts reform is available on Statistics Finland's website at: http://www.stat.fi/til/vtp/vtp_2006-03-31_men_007_en.html and information concerning the accuracy of the new quarterly compilation method for GDP is available on the website at: http://www.stat.fi/til//ntp_2006_01_2006-06-09_men_001_en.html

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Last updated 7.9.2006