New figures show the number of vacant jobs dropped dramatically in Norway over the past year, making competition more fierce and signalling tougher times. Optimism remained high among Norwegians however, with the latest consumer outlook survey showing increased confidence and school dropout rates remaining relatively high, as is the trend in prosperous times.
Statistics Norway (Statistisk Sentralbyrå, SSB) found there were 61,000 job vacancies at the end of March, 6,500 fewer than the same time last year, reported newspaper VG on Wednesday. The private sector saw the biggest drop, with 2,000 fewer vacancies between the first quarter of 2013 and the first quarter of this year. However, the branch still has the highest percentage of vacant positions, at 5.3 percent.
An overview of online job advertisements by search engine Rubrikk.no supported the SSB findings. It found that in May, there were 7,500 fewer vacancies than in the past year, reported Norwegian Broadcasting (NRK). In the last month alone there has been a 26 percent downturn in the number of available positions across many industries.
“It suggests that there are very many large companies in Norway which are now taking a breather and considering what they will do with their organization,” said Rubrikk founder Adil Osmani. “They have simply stopped hiring new people.”
Business confidence dropping, consumer confidence rising
Svein Oppegaard, the director of the major employers’ organization the Confederation of Norwegian Enterprise (Næringslivets Hovedorganisasjon, NHO) said it’s a clear sign labour demand is slowing, and the market is getting tougher.
“This holds true very much with the signals we have from our member companies in our economic barometer,” he told VG. “There is a downturn in the activity, and that is reflected of course in less need for manpower and fewer advertisements for vacant jobs.”
At the same time, consumer confidence is growing. Finance Norway’s quarterly expectations survey looks at people’s confidence, both in terms of their personal finance and the national economy. While expectations are still lower than they were at the same time last year, the survey found Norwegians are slowly becoming more optimistic after a sharp drop in the fourth quarter of 2013. From the second quarter of 2013 until the first quarter of 2013, economic expectations dropped from 23.2 to 16.3, but have now made a modest rise to 16.8.
“The main figures show good faith in the future, but at the same time a good amount of room for sobriety in Norwegian households,” managing director Idar Kreutzer told NRK. “It is perhaps not so surprising. We see that unemployment is low, wage settlements have been stable at a relatively high level, and we have been through a period where we have lowered expectations for the economy in Norway. This has now turned around.”
Kreutzer said Norwegians are also putting more money away, with household bank savings increasing by almost seven percent over the course of a year from NOK 890 to 950 billion. “We must go back to 1994 to find comparably high rates of intention to save, and we had just had a bank crisis then, so people were very motivated to be cautious,” he said. People are choosing to invest in property, renovations and cars, while holiday cabin purchase rates remained stable, and spending on boats is relatively low.
Youth want a piece of the prosperity
The consumer optimism is reflected in the relatively high school dropout rates that have persisted for several years, reported newspaper Aftenposten. SSB figures showed just 69 percent of students who started high school in 2007 completed within five years. The numbers are particularly low for students doing vocational training, with only 55 percent completing in five years.
Kristine von Simson from the Institute for Social Research (Institutt for samfunnsforskning) said the lure of a good wage was strong for many students, prompting them to leave school to start earning money instead. When job opportunities in the labour market improve by 1 percent, the proportion of high school dropouts increases between 0.1 and 0.4 percent. Conversely, when unemployment rates rise, more young people stay in school.
“We invest in education today to reap the benefits through a better job in the future,” she said. “How long you choose to study partly depends on the opportunities in the labour market. In other words, it’s more expensive to go to school in good times than in bad.”
Von Simson warned young people tended to be short-sighted when deciding to drop out of school, putting too much emphasis on the present and not thinking about how the market could change. “If it is the case that they want to work, it’s maybe a solution to get more practical work into school life,” she said. “Many young people could perhaps think about having a closer connection to working life.”