Norges Bank

Press release

Regional Network: Continued growth – growing capacity constraints

According to Regional Network contacts, business sector activity continues to rise. The reopening of society is boosting demand, but contacts expect weaker growth ahead. Over half of the contacts report capacity constraints.

In the course of autumn, growth was most pronounced for services, but sales volumes in retail trade have fallen and growth in manufacturing has slowed.

Contacts expect weaker growth over the next six months. Some contacts report that the outlook is unusually uncertain. The uncertainty factors are primarily related to the evolution of the pandemic, raw materials shortages, freight challenges and production bottlenecks among suppliers. The interviews were conducted in the last week of October and the first two weeks of November. Since then, infection rates have risen substantially and both national and local Covid-related restrictions have been implemented.

Employment has increased substantially through autumn, but enterprises are planning for slightly weaker growth in the next three months. The share of enterprises reporting capacity constraints has not been as high since 2007. There is also an unusually large number of contacts reporting difficulties recruiting qualified labour. The estimate for annual wage growth in 2021 has been revised up to 3.0 percent, from 2.9 percent in August. In 2022, contacts expect that the wage level will rise by 3.3 percent.


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Published 7 December 2021 10:00
Published 7 December 2021 10:00