Employment Impacts of Supplier Companies by Municipality
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Regional economic impacts of the Turku shipyard and its network 2019 Brahea Centre at the University of Turku Mikko Grönlund, Tuomas Ranti and Tapio Karvonen Basic information of the review • The purpose of this review was to examine the regional economic impacts of the Turku shipyard and its network in the same manner as in the previous review conducted in 2017. The review also includes comparisons with the previous review. • The review was commissioned by the City of Turku and Meyer Turku Oy. • The review was based primarily on financial statements and other statistical data, though information was also collected through surveys targeted at the shipyard’s supplier companies. The data received from Meyer Turku Oy was crucial for the successful execution of the review. The key financial figures were primarily from 2018, for which financial data was comprehensively available, though information from 2019 was also utilised in the examination of some of the impacts. Graphs are based on data from 2018, unless otherwise stated. • The review was conducted in autumn 2019 by experts Tapio Karvonen, Mikko Grönlund and Tuomas Ranti from Brahea Centre at the University of Turku. Meyer Turku Oy Personnel development 20072019, forecast 20202023 3 000 • Key figures in 2018 (2016 in parentheses): • Own personnel 1 958 (1 567), 2 500 subsidiaries 247 (204) (Piikkio Works Oy, Shipbuilding Completion Oy and Technology Design and Engineering Eng’nD) 2 000 • Turnover: EUR 970 million (EUR 792 million) 1 500 • Value added: EUR 163 million (EUR 145 million) 1 000 • Preliminary data from 2019 500 • Own personnel: 2 124 • The fourth largest employer and second 0 largest industrial employer in Southwest 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Finland. Supplier network • In 2018, the shipyard had a total of 1,246 direct supplier companies, of which 927 were Finnish and 319 were foreign. • The supplier network has remained roughly the same size as in 2016 in terms of the number of companies, though the total value of supply has nearly doubled. • Direct suppliers have their own networks of subcontractors, which cover almost all Finland and extend across the globe. Supplier network (2) • Based on surveys, for approximately one half of supplier companies the value of supply orders to the Turku shipyard accounts for no more than up to 10% of the companies’ total turnover, whereas for approximately 10% of companies supply orders to the shipyard account for at least 90% of the companies’ total turnover. • No significant changes are expected in this regard. • The employment impacts of the shipyard’s supply orders on companies followed a similar distribution. • In the surveys, 63% of Finnish supplier companies indicated that their labour force is exclusively Finnish and 22% indicated that foreign employees account for no more than up to 10% of their total labour force. Economic impacts The shipyard’s suppliers and value of supply orders – domestic vs. foreign in 2018 Foreign 26 % Foreign 32 % Domestic 68 % Domestic 74 % Distribution of companies, n = 1 246 Distribution of the value of supply orders, EUR 933 million The shipyard’s suppliers and value of supply orders – domestic vs. foreign Value of supply orders in 2018 1 000 000 000 approximately EUR 933 million, EUR 933 million with the corresponding figure in 900 000 000 2016 being approximately EUR 508 million (+ 84%) 800 000 000 294 615 502 700 000 000 The value of domestic supply orders in 2018 was approximately 600 000 000 EUR 508 million EUR 638 million (+ 64%) € 500 000 000 118 063 021 The value of foreign supply orders 400 000 000 in 2018 was approximately EUR 295 million (+ 150%) 300 000 000 637 965 578 200 000 000 389 904 980 The proportion of domestic supply orders was 68%, with the 100 000 000 corresponding figure in 2016 being 0 77% Value of supply orders 2016 Value of supply orders 2018 Domestic Foreign The number of supplier companies has remained nearly unchanged (1,221/1,246) The shipyard’s foreign suppliers and value of supply orders in 2018 United Kingdom Others (16 1 % countries) Canada Denmark China Others (17 11 % 1 % Spain 1 % 1 % countries) France3 % Poland 4 % 3 % Lithuania 1 % 3 % Poland Norway 3 % 3 % USA Germany Italy 3 % 44 % 5 % United Kingdom 4 % Sweden Denmark 8 % 4 % The Netherlands 5 % Norway Germany 5 % 72 % Italy Sweden 7 % 8 % Distribution of companies, n = 320, 27 countries Distribution of the value of supply orders, EUR 295 million, 27 countries Distribution of the value of foreign supply orders in 2016 vs. 2018 United Kingdom 1 % Canada Denmark China Others (17 United Kingdom 1 % Others (19 countries) 1 % 1 % countries) 2 % 9 % Poland 4 % Spain Germany Lithuania 1 % Denmark 2 % 27 % 3 % 2 % Norway Poland 3 % 4 % Italy 5 % Norway 5 % Switzerland Sweden 6 % 8 % Italy 9 % Germany Sweden 72 % 24 % Lithuania 10 % Distribution of the value of supply orders in 2016, Distribution of the value of supply orders in 2018, EUR 118 million, 29 countries EUR 295 million, 27 countries Distribution of foreign suppliers in 2016 vs. 2018 Others (16 Others (19 countries) countries) 11 % 18 % Spain France3 % Germany 3 % Lithuania 30 % 3 % Poland 3 % Poland USA Germany 4 % 3 % 44 % USA United Kingdom 4 % 4 % Denmark Denmark 4 % 4 % The Netherlands United Kingdom Sweden 5 % 6 % 10 % Norway Italy The 5 % 6 % Netherlands Norway Italy Sweden 6 % 9 % 7 % 8 % Distribution of companies in 2016, n = 278, Distribution of companies in 2018, n = 320, 29 countries 27 countries Distribution of the shipyard’s domestic suppliers and value of supply orders by region in 2018 Tavastia Proper Others (10 Päijänne Central Finland 1 % regions) Tavastia Pirkanmaa Others (10 1 % 6 % Ostrobothnia 2 % 1 % regions) 2 % Päijänne Tavastia 1 % 2 % Satakunta 2 % Satakunta 4 % Tavastia Proper Pirkanmaa 5 % 5 % Uusimaa 41 % Southwest Finland 48 % Uusimaa 39 % Southwest Finland 40 % Distribution of companies, n = 926, 17 regions Distribution of the value of supply orders, EUR 638 million, 17 regions Distribution of the value of domestic supply orders by region in 2016 vs. 2018 Päijänne Tavastia Pirkanmaa Others (10 Ostrobothnia 2 % 1 % regions) Tavastia Päijänne Tavastia 2 % Proper 2 % Others (11 1 % regions) Satakunta Satakunta 2 % 0 % 2 % 3 % Pirkanmaa 3 % Tavastia Proper 5 % Ostrobothnia 9 % Southwest Southwest Finland Finland 48 % 52 % Uusimaa Uusimaa 29 % 39 % Distribution of the value of supply orders in 2016, Distribution of the value of supply orders in 2018, EUR 390 million, 18 regions EUR 638 million, 17 regions Distribution of domestic suppliers by region in 2016 vs. 2018 Tavastia Proper Others (10 Central Finland regions) Northern 1 % Tavastia Proper Others (11 regions) 1 % 6 % 2 % Ostrobothnia 1 % 5 % Päijänne Tavastia Päijänne 2 % Tavastia Satakunta 3 % 4 % Pirkanmaa Southwest Pirkanmaa 4 % 5 % Uusimaa Finland 41 % 41 % Satakunta 6 % Uusimaa Southwest Finland 38 % 40 % Distribution of companies in 2016, n = 943, Distribution of companies in 2018, n = 926, 17 regions 18 regions Distribution of the shipyard’s domestic suppliers and value of supply orders by sub-regional unit Others (35 Vakka-Suomi Vakka-Suomi Forssa sub-regions) Loimaa 1% Tampere Jyväskylä 1% 1% 10% 1% 1% 1% Others (35 sub- Salo Lahti regions) 2% 2% Loimaa Rauma 3% 2% 2% Vaasa Pori 2% 2% Helsinki Lahti 38% Hämeenlinna 2% 4% Rauma Turku 2% 46% Tampere 4% Helsinki 38% Turku 36% Distribution of companies, n=926, Distribution of the value of supply orders, EUR 638 million, 45 sub-regional units 45 sub-regional units Distribution of the shipyard’s domestic suppliers and value of supply orders by municipality Others (99 Lahti municipalities) Others (99 Turku Rauma 1% 9% municipalities) 22% 2% 29% Vaasa Helsinki 2% 28% Espoo 4% Hämeenlinna 4% Rauma Vantaa 2% Helsinki 5% Naantali 14% 2% Lahti Raisio 2% 8% Kaarina 2% Tampere Vantaa 3% Raisio 10% Turku Espoo Kaarina 6% 10% 8% 27% Distribution of companies, n = 926, Distribution of the value of supply orders, EUR 638 million, 109 municipalities 109 municipalities Distribution of the shipyard’s suppliers based in Southwest Finland and value of supply orders by sub-regional unit Åboland- Vakka-Suomi Turunmaa Åboland- 2,7 % 0,3 % Salo Turunmaa Vakka-Suomi Salo 3,8 % 0,8 % 2,3 % 0,1 % Loimaa Loimaa 4,0 % 2,4 % Turku 88,7 % Turku 94,9 % Distribution of companies, n = 372 Distribution of the value of supply orders, EUR 307 million Distribution of Meyer Turku Oy’s personnel Other regions Åboland- (6 regions) Turunmaa Uusimaa Helsinki 1 % Foreign Vakka-Suomi 1 % 1 % Salo 1 % 0 % 2 % Satakunta 2 % Others (10 sub- 2 % Rauma regions) 2 % 1 % Loimaa 3 % Southwest Finland Turku 96 % 88 % By region, n = 2,164, 9 regions By sub-regional unit, n = 2,164, 17 sub-regional units Data from 2019 Distribution of Meyer Turku Oy’s personnel by municipality Pöytyä 1 % Others (44 Paimio Parainen Aura 1 % municipalities 1 % 1 % 6 % Salo Rauma 1 % 1 % Rusko Nousiainen 2 % 2 % Mynämäki 2 % Masku 3 % Turku Lieto 49 % 4 % Naantali 5 % Kaarina 8 % Raisio 12 % Based on the data of 2,164 persons, 59 municipalities (in 2019) Distribution of Meyer Turku Oy’s personnel in Turku by Turku ward Hirvensalo-Kakskerta 5 % Varissuo-Lauste 6 % City centre 21 % Maaria-Paattinen 7 % Nummi-Halinen 8 % Runosmäki-Raunistula Skanssi-Uittamo 9 % 17 % Länsikeskus 12 % Pansio-Jyrkkälä 15 % The number of personnel living in Turku was 1,065 (in 2019) Distribution of Meyer Turku Oy’s and its subsidiaries’ personnel Other regions (6 regions) Åboland-Turunmaa HelsinkiPori Uusimaa 1 % 1 % 1 % 1 % 1 % Vakka-Suomi Satakunta