Mall of Tripla. Photo: Andy Ngo

Companies thrive better in Helsinki – land use planning, plot issues and feedback system still to be improved

Helsinki’s business advisory services, electronic transactions, marketing cooperation and employment services are strengths from the viewpoint of businesses. Criticism has in turn been raised particularly concerning land use planning and plot issues as well as the feedback system, but these were also perceived as better than in the previous survey. These are the results of an extensive phone survey of a thousand businesses implemented by Taloustutkimus Oy on behalf of the City of Helsinki.

The aim of the survey was to find out the views of businesses concerning the City’s economic development policies and business friendliness as well as their satisfaction with Helsinki as a location. In addition, the study provides information on businesses’ recruitment, relocation and expansion intentions as well as on the availability of suitable workforce.

Businesses’ numerical ratings of the City slightly improving

Regardless of the challenging pandemic situation, the results of the 2020 survey turned out to be slightly better than those of the corresponding surveys implemented in 2018 and 2016.

“As the world recovers from the coronavirus pandemic, cities’ competition is becoming harder. Our ability to attract businesses and competent workforce is a key success factor, and it is crucial to profile Helsinki as a business-friendly location. The results of the survey indicate that we are moving in the right direction, but a lot remains to be done,” says Mayor Jan Vapaavuori.

Businesses’ willingness to recommend Helsinki as a location is in a slight decline. From the viewpoint of businesses, the main reasons to recommend Helsinki as a location were the City’s wide market, customer potential, central location and public transport. The overall price and cost level were the most common reasons for unwillingness to recommend the city. Permit processes are also perceived as slow, cumbersome and difficult to understand.

“Understanding the needs, views and expectations of businesses and communication about the City’s operations are the keys for the continuous improvement of business operating environment. In the future, we will pay particular attention to how businesses interact with the City,” Economic Development Director Marja-Leena Rinkineva says.

Companies of ICT, financial, insurance and real estate sector most satisfied with Helsinki

Unsatisfied businesses were most frequent in the transport, warehousing and industry sectors. Important employers in the city, trading businesses were also more critical than average. Tourism and accommodation businesses were also less satisfied than earlier, which is in part explained by the coronavirus situation. Willingness to recommend was highest in the ICT, financial, insurance and real estate sectors.

44 per cent of the businesses have relocation or expansion plans. Those planning to relocate are primarily intending to do so within Helsinki, but one third of them are considering other locations as well.

“Nine out of ten businesses are interested in cooperation with the City of Helsinki. The coronavirus period has highlighted the significance of business networks. This is a clear sign to us to put an even stronger emphasis on dialogue and joint action with businesses and other operators of the growth business ecosystem,” Rinkineva says.

Businesses are particularly interested in research, development and innovation collaboration with the City. In the coming years, the City will invest particularly in early-stage research and student-oriented businesses by developing preincubation and incubation operations together with the higher education institutions of Helsinki. Business incubators as well as hubs and services promoting innovative entrepreneurship are being launched in different sectors. Product development and new business opportunities are promoted by the City’s continuously growing role as an experiment, development and innovation environment for businesses. In addition, the City is increasingly supporting innovation through procurement. The interviewees also believe that the City is able to influence businesses’ success through its actions.

Background information

The interviews for the City of Helsinki business survey implemented by Taloustutkimus Oy were carried out during the period between 29 September and 3 November 2020. The City’s business survey is the most extensive available knowledge base on the views and customer experiences of Helsinki business representatives. The interviews were implemented through so-called discretionary sampling. In total 1,000 businesses participated in the interviews.