Migrant business owners: a growing resource for Espoo and Finland

Finland needs business owners. And right now, one group of business owners is growing faster than others: migrant business owners.

A recent study by Pellervo Economic Research (PTT), led by Juho Alasalmi and Hanna Busk, entitled Migrants’ significance in business and the economy, shows that migrant entrepreneurship is becoming more widespread and playing a significant role for Finland’s economy. In Espoo and the entire capital region, this trend is already tangibly visible – but the same area also faces the greatest challenges preventing the fullest use of the potential.

This year, I had the chance to deepen my knowledge of this topic in two important roles: one the board of Espoon Yrittäjät and the other on the Suomen Yrittäjät Migrant Entrepreneur committee. I’m excited to see what kind of solutions we can develop together to support growth, profitability and better entrepreneurial conditions for all business owners in Finland and in Espoo in particular.

Espoo and the capital region – the centre of migrant entrepreneurship

In Espoo and the capital region, migrant business ownership has become a significant motor of the economy and employment. The municipalities of the capital region are already home to thousands of migrant-owned businesses, and their number is constantly increasing. In particular, the restaurant, construction, service and technology sectors are ones in which migrant business owners are strongly represented.

The PTT study found that in 2022, 10.5% of business owners in Finland had a migrant background, and that their share among all business owners had grown faster than within the Finnish-born population. 

Migrants are also more likely to start their own business than others: 11.9% of working migrants run their own business, while the corresponding proportion in the Finnish-born population is 9.9%.

But even more important is the fact that migrant entrepreneurs do not just employ themselves, but also others. 

Between 2014 and 2019, migrant-owned micro- and small enterprises created more new jobs than equivalent businesses among the Finnish-born population.

The City of Espoo’s strategy has the aim of attracting high-skill businesses and international players, but at the same time we must remember that local enterprise is the bedrock of the city’s economy. This means that all business owners – Finnish-born and migrant alike – need support and opportunities for growth.

Same challenges year after year – how can we solve them?

Even though migrant entrepreneurship is on the increase, to a large extent the biggest challenges remain the same:

 Availability of finance – Banks’ and financial institutions’ caution may make starting and growing a business more difficult.

 Lack of networks – Many migrant business owners have weaker contacts with business networks, which makes cooperation and finding new clients harder. In addition, social interactions where migrant business owners have the chance to create other kinds of support networks for their everyday lives are needed.

 Complicated bureaucracy – The rules and regulations related to starting and running a business can feel difficult, particularly for people whose Finnish-language skills are not yet strong.

A particular challenge in Espoo and the capital region is also the availability and cost of business premises. In growing areas, the rent level of premises can be too high for new business owners. Here, collaboration between the city and business networks can play a significant role.

What next? Tangible steps forward

In light of the study, it is clear that promoting migrant entrepreneurship requires targeted action and active impact.

The following issues are crucial areas for improvement:

✅ Better availability of finance – We need new finance models and more flexible loan options which take migrant business owners’ circumstances into account.

✅ Stronger networks – Espoon Yrittäjät and other local organizations play an important role in supporting, mentoring and advancing collaboration with new business owners.

✅ Supporting growth entrepreneurship – Many migrant business owners want to grow, but the necessary tools and support are not always available. Here the role played by SY and other organizations is crucial.

✅An enterprise-friendly Espoo – The city should make even better consideration of migrant business owners in its business policy and develop services to better meet their needs.

This year, I will be working precisely with these issues on the board of Espoon Yrittäjät and the Suomen Yrittäjät committee.

It is clear that migrant entrepreneurship is not just a solution for individuals; it is also an opportunity for society as a whole.

Espoo is a city with vast potential for business, but the opportunities for growth must be ensured for all business owners – not just large international companies, but also local and migrant business owners who build everyday services and create jobs in our city.

At Espoon Yrittäjät, we are extremely interested in hearing business owners’ experiences and thoughts about the challenges and opportunities that they face as migrants running their own business.. The conversation is now more important than ever, and by collaborating, we can build better conditions for all business owners.

Berit Virtanen-Thewlis
Board member, Espoon Yrittäjät