Norges Bank

Press release

Regional Network: High capacity utilisation and accelerating rise in prices

According to Regional Network contacts, business sector activity continues to rise. As a result of the lockdown before Christmas, activity declined in household services, while the other sectors reported growth in activity. Contacts expect stronger growth over the next six months. At the same time, over half of the contacts reported capacity constraints, which is the highest share since autumn 2007. The interviews were conducted before the invasion of Ukraine.

Capacity constraints have increased in all sectors except retail trade. Contacts are facing recruitment difficulties, as well as logistics challenges and shortages of intermediate goods. Contacts have revised up their estimate for annual wage growth in 2022 to 3.7%, compared with 3.3% in November. The rise in prices has picked up and contacts expect an even stronger rise ahead.

Enterprises expect activity growth to pick up through spring and summer. Contacts are less concerned about the evolution of the pandemic and Covid-related restrictions than previously. For many, uncertainty is primarily related to capacity constraints and a rapid rise in prices.

Employment has continued to rise, albeit not as much as in the two previous surveys. The slower rise appears to be temporary. Looking ahead, enterprises expect the rise to be on par with summer and autumn 2021.


Report: Regional Network 1/2022


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Published 15 March 2022 10:00
Published 15 March 2022 10:00