The index level for Norwegian manufacturing in the period February-April 2021 amounted to 120 (2005=100). The corresponding figure for the previous three-month period was 118.8. After a sharp decline from March to May 2020, manufacturing production has since seen a recovery. Despite a clear decline compared to March, the production activity in April 2021 is more or less on the same level as seen prior to the Covid-19 pandemic.

Figure 1. Production development in manufacturing. Seasonally adjusted and smoothed seasonally adjusted figures.¹ 2005=100

¹ March 2020 and the subsequent months are specified as outliers in the seasonal adjustment routine. Hence, the trend figures for 2020 are not included in the figure.

Monthly change: clear decline in April, after high output level in March

According to , manufacturing output had a clear decline of 1.9 per cent from March to April 2021.The decrease comes after three consecutive months with high production activity. Several industries registered decline; most prominently computer and electrical equipment, repair and installation of machinery, and building of ships, boats and oil platforms.

The overall output decline was mitigated by strong growth within basic chemicals, which saw an increase of 9.7 per cent.

Three-month change: Food products contributed to overall output growth

According to seasonally-adjusted figures, manufacturing output saw an increase of 1 per cent in the period February to April 2021 compared with the previous three-month period. Manufacturing branches not related to the oil and gas industry contributed strongly to the overall growth in this period. was more or less unchanged compared to the last three-month period (see figure 2).

Food products and the industry grouping refined petroleum, chemicals and pharmaceuticals contributed the most to the total growth in manufacturing output with an increase of 3 and 3.4 per cent respectively. Businesses within the industry repair and installation of machinery also saw a clear output growth.

On the other hand, the industry grouping computer and electrical equipment together with building of ships, boats and oil platforms saw production decline in this three-month period. The decline in the latter industry was partially related to difficulties with access to labour from abroad due to restrictions on international travel and quarantine requirements.

Figure 2. Indicator for petroleum-related industries. Seasonally adjusted. Three-month moving average¹. 2005=100

¹ The index value for period m is the average of period m, m-1 and m-2

Monthly change: Output in the Euro area unchanged in March 2021

Estimated figures from Eurostat, the EU’s statistical office, indicate that manufacturing output in the was unchanged from February to March 2021.

In the same period, Norwegian manufacturing production had an increase of 0.7 per cent. Sweden had an increase of 2.8 cent, while Denmark saw a large increase of 5 per cent.

For more information on the development in European manufacturing sector, see this article from Eurostat.

Figure 3. Index of production for manufacturing. Euro area and Norway (2015=100). Seasonally adjusted

Three-month change: growth in the total production index

According to seasonally-adjusted figures, the total production index (PII) covering extraction, mining, manufacturing and electricity supply had an output increase of 1 per cent in the period February to April 2021 compared with the previous three-month period. Extraction of crude petroleum saw an increase of 1.2 per cent, while extraction of natural gas fell with 1.2 per cent. For more details about oil and gas extraction in this period, see the press release from The Norwegian Petroleum Directorate.

Within support activities for petroleum and natural gas extraction, there was an output growth of 1.8 per cent in the period February to April 2021 compared with the previous three-month period. In the same period mining and quarrying saw a substantial drop of as much as 22.7 per cent, while production within Norwegian electricity supply increased slightly by 0.9 per cent. The severe drop in mining and quarrying must be seen in context with a relatively cold winter this year.

Figure 4. Production development. Seasonally adjusted. Three-month moving average¹. 2005=100

¹ The index value for period m is the average of period m, m-1 and m-2.

Thursday 12th of March 2020 the Norwegian government introduced actions against the spreading of the Corona-virus in Norway. Several manufacturing establishment have been affected by these measures, and this has led to a change in the activity pattern compared to what we usually observe. Hence, the seasonal adjustment routine during the Corona- crisis is done in such a way that the figures during the crisis (from March), are not included in the basis for the calculation of the seasonal pattern. Technically, in the seasonal adjustment routine this is done by specifying March and following months as outliers.

This implies that normal trend figures will not be calculated, and instead the trend will follow the seasonal adjusted figures. One important exception is the last observation, where the trend will be an extrapolated figure where the last observation is not included. The trend figures from, and including, March 2020 will therefore be difficult to interpret.

The seasonal adjustment routine of Statics Norway is in line with the recommendations of Eurostat.

It is important to be aware that the uncertainty for the calendar-adjusted and seasonally-adjusted indices for March and April is greater than normal due to the changed placing of Easter. This effect will also affect the seasonally-adjusted figures for the 1st and 2nd quarters. This is accounted for when adjusting for seasonal variations. However, it can still be difficult to adjust for all impacts.