Norwegians buying more time

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New studies show that many Norwegians, armed with a big increase in purchasing power in recent years, are opting to spend their disposable income on more time-saving services and fewer material items. Growth in consumption of goods has stagnated, while Norwegians are buying more services than ever before.

Among them, for example, are the dog-walking services sold by Tess Erngren in Oslo, reports newspaper Dagens Næringsliv (DN). She recently launched a new business that offers several hours of companionship and exercise for clients’ dogs four days a week. Her new services, costing NOK 2,000 (USD 350) per month per dog, were fully booked just a few hours after she started up.

“I almost regret that we’re not charging more than NOK 2,000,” she told DN.

Busy people buying time
Erngren’s new business is among many selling services that busy and newly affluent Norwegians no longer want to take the time to perform themselves. Companies offering cleaning services, home repairs and delivery of partially or fully made dinners and other food are among those growing quickly, according to analysts. “Our impression is that there’s a strong increase in paid cleaning services in the home,” analyst Lasse K Tenden of employers’ organization NHO told DN, even though firm figures are hard to present  because of the amount of such services paid under the table and not reported to tax authorities.

Steinar Juel, chief economist at major Nordic bank Nordea in Oslo, said he thinks many Norwegians feel they now have enough “things” and therefore are spending more money on non-tangibles like help at home and recreation.

Analyses that he and his team presented this week show that Norwegians’ overall consumption is in a much higher division than their neighbours in Sweden, Denmark and the rest of Europe. While private consumption in the eurozone is at the same level as when the finance crisis began in 2008, it has risen more than 10 percent in Norway and is expected to rise another 3 percent annually over the next few years.

Help and holidays
The increase is tied to Norwegians’ increased purchasing power but consumption of goods is up just 2.5 percent during the past year. Consumption of services is up 3 percent, according to state statistics bureau SSB.

“It seems natural that when folks have higher incomes, they take an extra trip to the hair salon or spend the money on a personal trainer instead of buying another TV,” Katrine Boye, senior analyst at Nordea, told DN.

Norwegians are also spending much more money abroad, because of large increases in household travel and holiday budgets. Nordea’s analysts also pointed to increased spending in Sweden, as Norwegians seek ways of avoiding high prices at home.

The economists, meanwhile, predict more good times ahead for Norwegians, because of the country’s low unemployment (3.1 percent), rising incomes (up 4.2 percent this year), low inflation (0.7 percent) and booming oil and gas industry.

Views and News from Norway/Nina Berglund

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