Norway expects slow labour growth
The energy-rich economy of Norway does not expect to see employment to return to what would be considered normal levels until 2023, the government reported September 3.
Statistics Norway, the government’s record-keeping division, expects gross domestic product (GDP) to show growth of 4.1% this year, but to slow moving forward. GDP growth by 2024 is forecast at around 2.2%.
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Total exports for the year are expected to see growth of 7.1% from 2020 levels, but that too declines to 2.6% by 2024. Exports of crude oil and natural gas, meanwhile, will expand from 0.3% last year to 6.3% for full-year 2021, but will then drop substantially to show 1.7% growth by 2024.
Statistics Norway expects overall economic growth to “pick up considerably in 2022,” but stressed that employment levels may remain suppressed.
“The ramifications of the international recession and national infection control measures will impact on the Norwegian economy for some time to come,” it said.
The agency does not expect labor activity to return to “what is considered a more normal level” until 2023. US president Joe Biden said September 3 that low hiring was a result of the rapid spread of the Delta variant of the coronavirus.
Norway has helped prop up oil companies during the pandemic by providing some 100bn kroner ($10.6bn) in tax relief aimed at encouraging them to continue investing despite the market downturn last year. The government on August 31, however, announced an increase in oil and gas taxation, two weeks ahead of parliamentary elections that will see the ruling coalition of Conservative prime minister Erna Solberg face off against the opposition Labour party and its allies.
The oil and gas industry typically provides around 20% of Norway's budget receipts.
For July, the last full month for which the Norwegian government provided data, oil production was higher than expected, while natural gas production was lower. Total July gas sales of 9.7bn m3, however, still represented a 1.8bn m3 increase from the previous month.