Virtues and Sins Part IV: Diligence vs. Sloth

Diligence refers to hard work, work ethic, and the belief that work is good in itself. As opposed to sloth, defined as spiritual or emotional apathy.

In other words, a diligent person is someone who performs given tasks with high integrity, perhaps even mechanically, without ever questioning why he/she is doing a certain activity? Whereas a sloth is someone who couldn´t care less?

This is one of the things that have been on my mind ever since I have, again, been on the job market. I have asked myself whether being unemployed is equal with being a sloth? It cannot be that simple.

The break-out of the global financial crisis in early 2008 has affected many people´s lives around the world. Not every unemployed person is unemployed because of laziness. On the contrary – most unemployed people want to get back into work life, but how, when firms are constantly dismissing staff and not keen on investing at all. This is the situation in many countries right now, including Finland, where both private and public debt have increased, and where we now all suffer from the aftermath of over-consumption.

The markets have changed. For good. How useful is diligence in countries that are struggling with their economies? States that have outsourced the majority of production to low-wage countries in order to increase revenue (which, by the way, in the long run is probably becoming more costly for these countries´ economies).

Those who have even the slightest understanding of economics in general know how to read between the lines. They also comprehend that investors want a return for the risk they are taking when lending their surplus to diverse firms on divers markets worldwide.

The European Commission is running a strategic program named “Europe 2020 targets”. The main targets are as follows:

1. Employment

– 75% of the 20-64 year-old to be employed

2. R&D

– 3% of the EU’s GDP to be invested in R&D

3. Climate change and energy sustainability

– greenhouse gas emissions 20% (or even 30%, if the conditions are right) lower than 1990

– 20% of energy from renewable energy sources

– 20% increase in energy efficiency

4. Education

– Reducing the rates of early school-leaving below 10%

– At least 40% of 30-34–year-old completing third level education

5. Fighting poverty and social exclusion

– At least 20 million fewer people in or at risk of poverty and social exclusion

Click here to access all the Europe 2020 indicators on the Eurostat website

Features of the targets

  • They give an overall view of where the EU should be on key parameters by 2020.
  • They are translated into national targets so that each Member State can check its own progress towards these goals.
  • They do not imply burden-sharing – they are common goals, to be pursued through a mix of national and EU action.
  • They are interrelated and mutually reinforcing:
    • educational improvements help employability and reduce poverty
    • more R&D/innovation in the economy, combined with more efficient resources, makes us more competitive and creates jobs
    • investing in cleaner technologies combats climate change while creating new business/job opportunities.

According to the European Commission, Finland has progressed both in terms of CSR and fiscal consolidation. Reforms in Finland include:

– Municipal structure

– Healthcare and social services

– Extension of youth guarantee

– Reduction of access to early retirement

– National competition authority

– Temporary tax incentives to support research and investments

Great strategic reforms on paper, but how well will these be executed?

Finland´s main policy challenges include the loss in competitiveness over the course of the past decade (from surplus to deficit). Since 2008 Finland lost 23 % of its share in world exports. Finland is certainly suffering from macroeconomic imbalances.

The main challenge right now, according to the EC, is the ability to attract new investments to the Finnish economy, in order to improve both employment and productivity, and to replace declined industries with new, lucrative options. Finland has an excellent research system which should be better taken advantage of in terms of innovation in both products and services (one good example of this is Finland´s rather new export success Supercell).

The ageing population is another challenge that Finland faces. This should be addressed, according to the EC, by improving labour market participation and by ensuring sustainability of pension and healthcare systems. Restructuring the municipal (healthcare) system is part of the plan.

The EC recommends Finland briefly to:

1. Ensure sustainable public finances

2. Increase productivity and save costs in public services

3. Increase labor market participation, in general

4. Extension of working lives and tackling both youth and long-term unemployment

5. Competition in product and service markets => decreasing regulatory barriers and improving free competition on the local market in Finland

6. Innovation and productivity in the private sector

See how Finland compares with other EU Member States in key areas 2013 European Semester Documents

(Source: European Commission. Europe 2020. Quoted on March 11th 2014).

Diligence is certainly needed not only in Finland, but in whole Europe, to successfully implement the strategy.