Increased growth in the mainland economy

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After 0.4 per cent growth in the 4th quarter of 2016, gross domestic product (GDP) for mainland Norway increased by 0.6 per cent in the 1st quarter of 2017. It is slightly higher than the projected trend growth.

Following two years of decline, seasonally adjusted figures show a clear rise in manufacturing and mining of 0.9 per cent in the 1st quarter. Activity growth was particularly marked in the accommodation and food industry, such as the production of chemical and pharmaceutical raw materials. For other parts of the industry, such as manufacturing of metal products, machinery and shipbuilding, activity fell in the 1st quarter after positive figures at the end of last year. Other goods-producing industries in the mainland grew by 0.6 per cent in the 1st quarter. Reduction in electricity production pulled down the growth for the fourth quarter in a row, while the value added in building and construction activities continued the strong growth that started in early 2015. Traditional fishing also increased in the 1st quarter, while production in aquaculture was nearly unchanged from the quarter before.

Figure 1. Gross domestic produkt. Seasonally adjusted. Volume indices. 2014=100
Figure 1. Gross domestic produkt. Seasonally adjusted. Volume indices. 2014=100
Gross domestic product Gross domestic product,Mainland-Norway
Q1-2005 88.68 77.99
Q2-2005 89.14 80.09
Q3-2005 89.88 80.16
Q4-2005 90.08 81.65
Q1-2006 90.66 82.39
Q2-2006 90.78 83.41
Q3-2006 91.71 83.91
Q4-2006 93.39 86.33
Q1-2007 93.41 87.32
Q2-2007 93.4 87.63
Q3-2007 94.6 89.79
Q4-2007 95.63 90.34
Q1-2008 94.38 89.57
Q2-2008 94.42 90.85
Q3-2008 94.25 91.17
Q4-2008 94.55 89.11
Q1-2009 93.85 88.8
Q2-2009 93.02 88.92
Q3-2009 93.08 88.66
Q4-2009 93.13 89.26
Q1-2010 94.88 90.58
Q2-2010 93.87 90.32
Q3-2010 91.54 90.7
Q4-2010 94.11 90.54
Q1-2011 94.14 91.37
Q2-2011 93.75 92.08
Q3-2011 95.27 92.53
Q4-2011 95.31 93.17
Q1-2012 97.38 94.95
Q2-2012 97.61 95.19
Q3-2012 96.19 95.84
Q4-2012 96.98 96.54
Q1-2013 97.15 97.18
Q2-2013 97.85 97.21
Q3-2013 98.81 98.16
Q4-2013 98.63 98.9
Q1-2014 99.1 99.25
Q2 2014 99.54 99.85
Q3 2014 100.31 100.22
Q4 2014 101.05 100.68
Q1-2015 100.85 100.97
Q2-2015 101.39 101.06
Q3-2015 102.97 101.13
Q4-2015 101.2 101.01
Q1-2016 102.56 101.33
Q2-2016 102.52 101.8
Q3-2016 102 101.93
Q4-2016 103.25 102.31
Q1-2017 103.48 102.97
 

Figure 2. Gross domestic produkt. Seasonally adjusted. Volume indices. 2014=100
Figure 2. Gross domestic produkt. Seasonally adjusted. Volume indices. 2014=100
Gross fixed capital formation,Mainland-Norway Consumption in households
Q1-2005 77.22 75.83
Q2-2005 79.02 76.91
Q3-2005 80.9 78.41
Q4-2005 87.33 77.46
Q1-2006 84.34 79.35
Q2-2006 89.93 80.97
Q3-2006 87.52 81.96
Q4-2006 92.89 82.42
Q1-2007 95.86 84.24
Q2-2007 98.62 85.16
Q3-2007 100.91 86.37
Q4-2007 109.6 87.22
Q1-2008 104.33 88.36
Q2-2008 102.05 88.3
Q3-2008 102.2 86.81
Q4-2008 101.16 85.86
Q1-2009 92.38 85.01
Q2-2009 89.46 86.85
Q3-2009 87.9 87.86
Q4-2009 96.24 88.34
Q1-2010 83.97 90.04
Q2-2010 84.67 89.79
Q3-2010 85.56 90.73
Q4-2010 88.41 91.29
Q1-2011 91.39 91.55
Q2-2011 89.1 92.19
Q3-2011 89.41 92.48
Q4-2011 90.73 93.52
Q1-2012 91.73 94.57
Q2-2012 92.36 95.63
Q3-2012 99.41 96.31
Q4-2012 103.4 96.47
Q1-2013 95.29 97.79
Q2-2013 100.31 98.06
Q3-2013 100.06 98.8
Q4-2013 102.18 98.98
Q1-2014 98.55 99.18
Q2 2014 101.01 99.92
Q3 2014 100.67 100.08
Q4 2014 99.76 100.81
Q1-2015 97.25 101.24
Q2-2015 100.08 101.98
Q3-2015 102.56 102.26
Q4-2015 102.53 102.8
Q1-2016 102.7 103.28
Q2-2016 105.56 103.46
Q3-2016 108.89 103.48
Q4-2016 109.22 104.21
Q1-2017 109.95 104.88

The preliminary figures show that the value added in business services, increased by 0.4 per cent. There was an increase in most areas with the exception of services related to oil and gas extraction. The fall in activity in this group pulled down the growth in service industries by 0.2 percentage points. Value added in the public sector increased by 0.7 per cent in the 1st quarter, approximately the same as in the previous quarter. Increased activity in local authorities in particular pushed up value added.

Value added in extraction as well as transport via pipelines of oil and gas, as well as foreign shipping decreased during the 1st quarter of 2017. This contributed to the total GDP increasing by 0.2 per cent, after a growth in total GDP of 1.2 per cent the previous quarter. 

Moderate household consumption growth continues

Households’ total consumption increased by 0.6 per cent in the 1st quarter, after having increased by 0.7 per cent in the 4th quarter of 2016. Commodity consumption developed weakly during the first three months of the year, especially in March, but this may be characterised by challenges with seasonal adjustment related to Easter. Consumption growth was 0.2 per cent in the 1st quarter, compared to 0.6 in the previous quarter. Service consumption continued to increase at the same rate as before. In the 1st quarter, the increase was 0.7 per cent.

Public consumption increased by 0.4 per cent in the 1st quarter and was dampened by a decline in defence spending. 

Increase in mainland investment

Investments in mainland Norway have seen a clear increase in the last five quarters, and 0.7 per cent in the 1st quarter of 2017. This development is largely linked to strong growth in dwelling investments. In the first quarter, they increased by 3 per cent, while the annual average growth rate was 9.9 per cent in 2016. Public sector investment increased in the first quarter after increasing by almost 7 per cent from 2015 to 2016. On the other hand, total investments in mainland industries and in manufacturing and mining decreased after a clear growth through 2016.

Preliminary calculations show that petroleum investments rose by 2.7 per cent in the 1st quarter of 2017 following a continuous decline since the 3rd quarter of 2013. The forecast for the 4th quarter of 2016, published in February, has been revised downwards.

In total, gross fixed capital formation increased by 0.5 per cent in the 1st quarter following a corresponding fall in the previous quarter. 

Traditional exports up after a low 4th quarter

Exports of goods and services increased overall by 0.9 per cent in the 1st quarter of 2017. However, the strong growth of 7.8 per cent for exports of traditional goods has to be seen as a result of an even greater decline in the previous quarter. This is especially related to refined products, which fell sharply in the 4th quarter of 2016 due to maintenance work in production. Meanwhile, exports are back at a normal level in the 1st quarter of 2017. Export volumes of both oil and gas and services, however, were reduced and thus dampened the increase in total exports.

Imports of goods and services increased by 2.8 per cent in the 1st quarter after a decline of 1.5 per cent in the 4th quarter of 2016. As a yearly average, imports increased by 0.8 per cent last year.

Slight increase in employment

Preliminary calculations show that seasonally adjusted employment increased by 0.1 per cent or about 3100 people from the 4th quarter of 2016 to the 1st quarter of 2017. The number employed in the 1st quarter of 2016 was about 14 000 higher than in the same quarter in 2016. A large part of the employment increase in public administration is approximately equal to the increase in total employment in both the first quarter and the last four quarters. There was also a significant increase in building and construction, but also in business services and in accommodation and catering operations there has been a clear growth. On the other hand, in petroleum and manufacturing, the decline we have seen since 2014 continued. 

Employment in national account and LFS

Employees in the national accounts have shown a somewhat stronger development over the past year than is found for employees in the labour force survey (LFS). The national accounts use more sources in the calculation of employment, where the most central source of wage earners is salary and personnel data reported as part of the A-scheme. In practice, almost every country's employers are required to report through this scheme. LFS is a sample survey, and as with all sample surveys, there is uncertainty about the results. The error margin for total employment in LFS is estimated at +/- 18 000 persons. The population of employed persons is somewhat different in the national accounts and in the LFS. LFS measures employment among persons registered as resident in Norway, while the national accounts measure employment in businesses in Norway, regardless of whether the employees are registered as resident or not.

 

Figures for the 1st to 4th quarter 2016 have been revised

In connection with the release of the figures for the 1st quarter of 2017, all quarters in 2016 are revised. The new figures show a quarterly growth in GDP for Mainland Norway of 0.3, 0.5, 0.1 and 0.4, which implies an upward revision in the 4th quarter.

An overview of the revisions in macroeconomic variables is given in Appendix table no. 8.

For an overview of developments in the gross domestic product for some of our trading partners, see OECD’s statistics.

How the figures are calculated

The sum of four quarters in the Quarterly National Accounts (QNA) makes up the preliminary annual figures until the Annual National Accounts (ANA) for year t are published in August in year t+2 and incorporated as a new base year in the QNA. Hence, 2014 is the base year in the QNA when publishing data in May 2017.

In both the ANA and QNA, the figures stripped of movements in prices are referred to as volume changes, or fixed price estimates in the QNA, and this is done to identify the underlying cyclical pattern of the economy.

Note that in the time series in volume, the figures from the base year and onwards are fixed price figures, while data prior to the base year are chained volume figures. This implies that additivity in volume is lost prior to the base year.

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