Abrupt structural change (ÄRM)

Globalisation and changes in production structures may cause abrupt and substantial threats and problems for regional development, especially when a company lays off a large number of employees or closes down its production plant in the region. The consequences and impacts of the problems arising from abrupt structural change are assessed from the perspective of the region’s employment situation, industrial operations and business structure.

The Government may designate an area or a sector as an area or sector facing abrupt structural change. A growth plan aimed at managing the abrupt structural change is jointly prepared for the area or the sector by the municipalities in the area, regional business actors, the ELY Centre and the regional council. The plan lays out the main proposals for creating new and securing existing jobs and the other corrective measures in different administrative branches.

Designating an area as an area of abrupt structural change is on a case-by-case basis using the following criteria:

  • business structures change and are reformed abruptly
  • the total number of jobs lost in a company and the whole production chain or cluster and the estimate of the number that will become unemployed totals several hundreds
  • the impact is felt over a wide area outside the region/jobs are lost in several municipalities simultaneously
  • the impact of the lost jobs on the region's rates of employment and unemployment
  • the situation is one of permanent change (temporary layoffs are not taken into account)
  • the region has a contingency plan for crisis situations, based on forecasts and drawn up by the various actors
  • the region has the potential for renewal as the result of continuous development of business structures and a growth plan has been drawn up on that basis
  • additional funding can realistically have significant impact on new business activity and the creation of jobs
  • a company is committed to cooperation.

Granting appropriations for areas and sectors affected by abrupt structural change is assessed on a case-by-case basis within the framework of the state budget and supplementary budgets. Programme funding that is in accordance with the objectives of the Structural Fund Period 2014 - 2020 may also be used for projects aimed at managing abrupt structural change.                                                     

Since 1.1.2018 there are no areas which have abrupt structural change status.

Further information: jarmo.palm(at)tem.fi