Slightly higher output growth
Contacts in Norges Bank's regional network reported that output growth has edged up over the past 3 months, in line with expectations in February. There are prospects of continued moderate growth ahead.
Output growth has picked up in traditional manufacturing and household-oriented industries, driven in particular by stronger demand from several export markets and higher public investment, although contacts also referred to the boost to activity provided by an early spring. On the other hand, growth has remained low in the construction industry, partly due to fewer housing starts. Lower growth in demand from the Norwegian petroleum industry and increasing competition from foreign operators have dampened growth in the oil industry supplier sector.
Overall, there are prospects for fairly stable growth over the next six months. Manufacturing for the domestic market and retail trade expected that growth might edge down, while construction contacts expected somewhat higher growth ahead, led by higher public investment and increased housing construction. Contacts expected that growth impulses from the Norwegian petroleum industry will continue to weaken.
Capacity utilisation has edged down, particularly in construction and manufacturing. The share of network contacts citing labour supply as a constraint on activity was unchanged from February.Employment growth has slowed somewhat from February and has been weaker than expected. Contacts expected employment growth to pick up slightly ahead.
Contacts estimated annual wage growth in 2014 at slightly below 3½ percent. Differences in wage estimates across sectors were still relatively small.
Information was provided by 313 regional network enterprises in this survey. The interviews were mainly conducted in May.
Press telephone: +47 21 49 09 30