From 2021 to 2022, the average annual earnings for a full-time employee increased by over 4%. This was the highest annual increase since 2008.
Despite wage growth, workers faced a decline in real wages in 2022, as inflation surpassed wage increases, leading to reduced purchasing power. Inflation reached 5.8% in 2022, marking the highest annual increase since the 1980s. As a result, real wages fell by -1.4%.
Given that real wage growth ended at 0.0% in 2021, as wages and prices increased equally, 2022 is the second year in a row without real wage increases in Norway.
Strong coordination between sectors in the wage formation
Coordinated wage bargaining is a key feature of Norway’s approach to setting wages. In this model, there is a high degree of coordination between the different negotiating areas, with the manufacturing sector, which is exposed to international competition, serving as a benchmark for wage growth in other sectors. The aim of this coordination is to ensure that annual wage growth is not higher than what companies in internationally exposed sectors can sustain in the long term.
The similarities in average wage growth across the main negotiating areas over the past years are an indication of the high degree of coordination. This approach allows for the maintenance of a balance between wages and productivity, ensuring that businesses in internationally exposed sectors can remain competitive, while also ensuring an even distribution of wage growth to workers across different sectors of the economy.
High wage levels in Norway compared to other countries
Norway has one of the highest wage levels among industrialized countries, according to the OECD. (Note that comparisons of wage levels between countries can be challenging and should be interpreted with caution.)
Data from the OECD also show that wages in Norway have grown faster than most other countries from 2000-2007 (3.2% compared to an OECD average of 1.1%). However, from 2007-2021, average annual real wage growth in Norway has been more in line with other countries (1.2% compared to an OECD average of 0.7%). This is worth noting that real wage growth has been significantly lower from 2007-2021 than from 2000-2007 for most of the OECD-countries.
Earnings by occupation
Statistics Norway publishes data on monthly earnings for almost 400 occupational groups. Employees’ occupations are classified based on the actual job content, and not their educational level, type of employment contract, wage or sector.
The searchable table on Statistics Norway’s website contains data for almost 400 occupational groups for 2022. As per the latest data, mining managers were the highest-earning occupational group, followed by trade brokers managers and securities and finance dealers and brokers.
Note that the monthly earnings referred to in the visualizations below include agreed monthly earnings, including bonuses and irregular supplements, but exclude overtime pay.
It’s important to note that in almost all occupations, the average wage is higher than the median wage. This is due to the uneven distribution of earnings within each occupation. A chart provided by Statistics Norway, reproduced below, illustrates this by mapping the distribution of monthly earnings in 2021 for all wage earners.
The majority of people are in the low to medium earnings ranges, with a small percentage earning very high wages. According to Statistics Norway, 60% of wage earners earned less than the average wage in 2021. This highlights the importance of understanding both the average and median wages when analysing earnings data, as it provides a more complete picture of the distribution of wages within a given occupation or overall economy.
The uneven distribution of earnings within each occupation is the reason why the average wage is higher than the median wage. The median is the centerpoint of the distribution and in 2021, according to the data provided by Statistics Norway, the median was around 5,000 NOK lower than the average.
Tthe difference between average and median wages can vary widely depending on the occupational group. The table below shows this difference among occupational groups. For example, for some occupational groups, such as brokers, the average wage can be as high as 30% above the median wage, which indicate that there are some very high earners in the distribution.
Earnings by occupation and sector
Statistic Norway also publishes earnings data for the same type of occupation in different sectors of the economy. For relevant occupational groups, this allows for comparisons of what similar occupations earn in the public and private sectors.
Differences in earnings between women and men
There are several ways of measuring earnings differences between women and men. The chart below shows the differences in average monthly earnings and median monthly earnings, both for all employees and for full-time employees.
Women work part-time to a larger extent than men, and to a lesser degree than men have high wages. Even accounting for such factors by looking at full-time employees and median earnings, women earn less than men.
Differences in earnings by occupation between women and men
The table below shows women’s earnings as a share of men’s in different occupations. Women earn less than men in all but around 40 occupations. Brokers and sheet metal workers have the largest difference in favour of men, with women earning 71% of men’s wages. The largest difference, in favour of women, is for client information workers.
Earnings and educational level
According to data from Statistics Norway, it is clear that on average, individuals with higher levels of education tend to earn more than those with lower levels of education across all industries. However, when comparing earnings among individuals with similar educational levels, there are notable differences among industries.
Individuals with primary and lower secondary education as their highest level of education earn the most in the financial and insurance sector. Meanwhile, those with upper secondary and higher education earn the highest in the mining and quarrying industry.
Earnings by municipality
When looking at the earnings of individuals who work in a specific municipality, Bærum had the highest earnings level. Bærum is also highest when only looking at the wage level of thos residing in the region.
About the data
Data on earnings and wages are from Statistics Norway. Data on wage growth by negotiation area are from The Norwegian Technical Calculation Committee for Wage Settlement.