Productivity

Data Tracker on the Norwegian Labour Market

A highly productive labour market

In 2021, Norway had the third highest labor productivity level among industrialized countries, as measured by GDP per hour worked. This is due to a combination of factors, including a highly skilled and educated workforce, good working conditions, and a culture that values work-life balance og cooperation. Additionally, the country’s focus on innovation and technology, as well as its extensive social protection systems, contributes to stable working-life which in turn drives productivity.

It's important to note that when comparing labor productivity levels between countries, one should be cautious in interpreting the data. In certain countries, such as Ireland and Luxembourg, the presence of multinational companies can have a significant impact on economic output and income transfers. This can skew the productivity figures.

Lower productivity growth in recent years

In most industrialized countries, including Norway, there has been a trend of declining productivity growth since 2010.

When considering the last two decades as a whole, Norway's productivity performance is among the best among industrialized countries.

However, a closer analysis of the data reveals that the majority of Norway's productivity gains were made during the period leading up to the financial crisis (2000-2007), with growth rates during that time period being notably higher than those seen after 2010. Despite the more modest growth rates in recent years, Norway's productivity levels remain high.

Large differences in productivity between industries

The oil and gas industry is by far the most productive sector in the Norwegian economy, with a value-added of 5,800 NOK per hour worked. This is significantly higher than the industry average of 749 NOK per hour, and 624 NOK per hour for mainland Norway.

In a study of productivity growth over time, Statistics Norway found that since 2007, the manufacturing sector has had higher growth than the average for the mainland economy. Similarly, wholesale and retail trade, along with financial and insurance activities, have also experienced stronger-than-average growth during this period. Conversely, the construction industry has seen lower-than-average growth. This indicates that the productivity growth has not evenly distributed across all the sectors of the economy.

About the data

Data on productivity are from the National Budget and Statistics Norway. There is also a detailed industry comparison in Statistics Norway "Økonomisk Utsyn for 2020" (chapter 4).

International data on productivity are from the OECD and their "Compendium of Productivity Indicators".

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