Åland: Household income drops in municipalities in Åland

Key findings show that between 2011-2017 the average household disposable income has fallen in almost half of the municipalities in Finland and Åland due to recession and out-migration from rural areas. Finland and Åland also surpassed Sweden with the oldest age structure in the Nordics. While Finland has the lowest share of foreign-born population, Åland together with Sweden have the fastest growing share of foreign-born population (2006-2019).

Lower household income, less income inequality

The report highlights the striking difference between the trends in Finland and Åland compared to the rest of the Nordic Region. Average household income has increased in all municipalities in Greenland, Iceland, Norway and Sweden, while there is no data available for the Faroe Islands. In some of the municipalities in Finland and Åland, the decrease in household income has been more than 5%, while in Iceland, most municipalities have seen an increase of over 20%.

In the same period, income inequality diminished in approximately one out of four municipalities in the Nordic Region, notably in municipalities in Finland and Åland. According to the report, this narrowing of the household income gap is mainly due to the economic recession in Finland and Åland in the early 2010’s, combined with demographic factors, such as out-migration and ageing.

Changing population dynamics

Finland and Åland recently overtook Sweden as the oldest population in the Nordic Region, and, as is also the case in Denmark and Sweden, people aged 65 or older now outnumber children. In Norway, the two groups are approximately equal in numbers, while the Faroe Islands, Greenland and Iceland still have more children than people aged 65 or over.

According to the report, many rural regions in the Nordic Region have lost a large proportion of their youth population. However, there are refreshing exceptions to this trend, including Geta in Åland, in which the population aged 20-29 years has increased by 47%.

While Finland has the lowest portion of foreign-born population in the Nordic Region (7%), Åland’s share of foreign-born population has increased among the fastest in the Nordics from 10.3% in 2006 to 18% in 2019, while Sweden still holds the highest position with 19% of total population.

Åland drops five spots in Regional Potential Index

The report rates all Nordic regions in the Regional Potential Index (RPI), comparing them on a range of demographic, economic and labour force indicators. Oslo tops this year’s index ahead of the other Nordic capital regions, with the best scores in all three dimensions.

Åland is one of the highest-ranking rural regions in the RPI Index, and ranked 18th in the overall Index this year, dropping five spots since the last ranking in 2018. The indicators highlight a slightly improved demographic context and a rather stable labour and economic situation. However, other Nordic regions have increased their potential during the last two years, for instance, the Faroe Islands and Vesturland in Iceland, resulting in a lower rank for Åland.

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