Europe’s Workers Flock to Norway for Better-Paying Jobs

Photographer: Kristian Helgesen/Bloomberg

A Norwegian national flag flies from a vessel near the Scarabeo 8 deepwater oil drilling rig, operated by ENI Norge AS, in Olensvag, Norway, on April 3, 2012. The world's seventh-largest oil exporter boasts no net debt, adding to its appeal as an alternative to the debt-riddled euro area. Close

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Photographer: Kristian Helgesen/Bloomberg

A Norwegian national flag flies from a vessel near the Scarabeo 8 deepwater oil drilling rig, operated by ENI Norge AS, in Olensvag, Norway, on April 3, 2012. The world's seventh-largest oil exporter boasts no net debt, adding to its appeal as an alternative to the debt-riddled euro area.

Pedro Dias cut his workday almost in half and tripled his pay after leaving his native Portugal for a job as a software developer in Oslo.

The 27-year-old, who escaped 15-hour days as a researcher at New University of Lisbon and now rarely works past 5 p.m., landed his job at Metafocus AS, a producer of web-based software, at a career fair in the Portuguese capital in February.

“In Portugal, with an average salary you will struggle and have to work longer hours,” he said as he looked at the waters of the Oslo Fjord from a patio outside his office in the capital. Dias says he enjoys his new job and his free time, during which he is preparing for his first half-marathon run.

With an economy stoked by oil riches, Norway is becoming a winner in the race for skilled workers as Europe suffers record unemployment. Euro-area joblessness was 12.1 percent in July and 16.4 percent are out of work in Portugal, which was forced to seek a bailout in 2011. Unemployment in Norway, western Europe’s biggest oil producer, has hovered at less than 4 percent since 2009, even amid a surge in jobseekers.

Europe’s second-richest nation per capita after Luxembourg has some of the developed world’s highest salaries and shortest work days. People in Norway are paid $80,000 a year on average and work 20 percent fewer hours than the average for the 34-member Organization for Economic Cooperation and Development, according to data from Statistics Norway and the OECD. The country lags behind only the Netherlands and Germany for shortest work days.

Photographer: Tomm W. Christiansen/Bloomberg

Europe’s second-richest nation per capita after Luxembourg has some of the developed world’s highest salaries and shortest work days. Close

Europe’s second-richest nation per capita after Luxembourg has some of the developed... Read More

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Photographer: Tomm W. Christiansen/Bloomberg

Europe’s second-richest nation per capita after Luxembourg has some of the developed world’s highest salaries and shortest work days.

Worker Shortage

Yet with 84 percent of companies experiencing a shortage of skilled engineers, according to government figures, the world’s fourth-largest gas producer is struggling to find the workers it needs to boost oil production. Oil and gas account for about 20 percent of gross domestic product.

Labor migration from the European Union rose by more than 10 percent in the first half of the year, according to the Norwegian Directorate of Immigration. The agency registered 21,000 new workers, mostly from eastern Europe, up from 18,000 a year earlier. While Norway isn’t a member of the 28-nation EU, it allows easy access to its labor market as a member of the European Economic Area.

Workers come to Norway from countries outside the EU as well. The agency granted 1,504 permits to skilled workers outside the EEA from January through May. It accepted 4,082 such workers in 2012, many of whom arrived from India. Norway’s labor force rose 9 percent from 2006 through 2012 to 2.68 million last year as employment gained 10 percent to 2.6 million, according to Statistics Norway.

Health Benefits

Norway, with a population of 5.1 million, provides residents with publicly funded health care and practically free education. It also offers benefits such as day care, for a cost of no more than $400 per month per child, and parental leave of as long as 14 months.

In return for its largesse, the country is attracting workers it needs to keep pace with record investment in its offshore oil industry. Spending on oil production is expected to rise to a record 211 billion kroner ($35 billion) this year, according to a survey by Statistics Norway.

Immigration has become an issue in the country’s election campaign ahead of the Sept. 9 vote. The Progress Party, set to be the second-largest group in government, has isolated itself from the country’s other six parties with its anti-immigration rhetoric and proposals to cut the number of immigrants from countries outside Europe.

Looming Elections

Polls show that the Conservative-led opposition bloc is poised to oust Prime Minister Jens Stoltenberg’s Labor-led government on promises of tax cuts and increased investment in infrastructure. Stoltenberg counters with pledges to boost spending on social benefits.

The AAA-rated country, which also boasts the world’s largest sovereign wealth fund -- valued at $750 billion -- emerged as a haven from the global turmoil as the $500 billion economy expanded through the crisis.

To compete for workers, companies such as Danish engineering firm Cowi A/S are approaching students before they graduate from university. Schools also are taking a more active role in getting students to stay in the country after their education.

It was through a university career fair that Abera Hailu Mewcha, a 35-year-old Ethiopian risk-management engineer with a degree from the Norwegian University of Science and Technology in 2009, was enticed to stay.

The number of companies thirsty for fresh graduates showed Mewcha that he could afford a comfortable life with a secure, exciting job. He decided to give Cowi’s Oslo unit a try.

Plan Change

“The plan was to get the degree and then go back home,” he said in an interview at the company’s office. “I could have gotten a good job in Ethiopia.”

Working in an environment in which Norwegian is the working language was a challenge, Mewcha said. Still, job satisfaction and a stable life for his family far outstrip the difficulties. Many companies use English as their working language.

Mewcha, whose wife works as a software engineer in Oslo, said learning Norwegian was worth the trouble. With one child at a local daycare and the other heading there too, the Ethiopian family couldn’t ask for more.

“We are stable here: good job, happy family,” Mewcha said.

At Statoil ASA (STL), Norway’s biggest energy company, “We are not capable of getting the work done without these foreign workers,” said Hans Jakob Hegge, senior vice president of Statoil’s Operations North.

International Staff

The unit, based in the small town of Harstad, is integral to Norway’s expansion off its northern coast. The Harstad office conducts exploration, drilling, field development and production. It has 300 workers from 23 different countries.

Statoil, which is 67 percent owned by the state, casts a wide net when it looks for staff. About 22 percent of its international recruits came to Norway last year, up from 16 percent in 2008, with the balance working in overseas offices. Statoil employs 20,000 people domestically, of whom 9 percent are from abroad, said Tone Rognstad, vice president for people and organization recruitment and communication at Statoil.

Based in Stavanger on Norway’s west coast, the company operates about 70 percent of the country’s oil and gas output and has annual sales of about $116 billion.

Norwegian companies have to be creative in coping with the lack of skilled workers, according to Lars-Peter Soebye, chief executive officer of Cowi. About 20,000 more experienced employees are needed in engineering consulting, he added.

Sent to India

The company, which employs 1,100 in Norway, has farmed out about 20 percent of its Norwegian work to India and Lithuania, where 320 engineering consultants ease the workload, Soebye said. In addition, he said, “We could use another couple of hundred workers in the Norway office.”

The pace of investment and labor shortages are adding to strains on Norwegian society. Average manufacturing labor costs are about $64.15 an hour, the highest among 33 countries examined by the U.S. Labor Department. That’s 35 percent more than in Germany and 80 percent more than the U.S. Norwegian home prices have more than doubled since the start of the last decade and household debt has risen to about 200 percent of disposable income.

The trend of more foreign students staying on in Norway emerged in 2010 when the “consequences of the financial crisis started to sink in,” said Guri Vestad, head of the international education office at the University of Oslo.

‘Norwegian Context’

The university also started helping foreign students prepare for interviews in “a Norwegian context,” and encourages those who want to stay to learn Norwegian, Vestad said. Language courses aren’t offered to students who take a curriculum in English.

The city of Oslo, along with event organizer Global Forums AS, this year added a career fair to their Global Talent Week with the goal of keeping international students in the country.

Dias, the Portuguese software developer, said he tries to speak Norwegian at every opportunity -- including at the company canteen, where he addressed the cashier in Norwegian as he paid for his chicken, potatoes and cole slaw.

“I think I will have everything I need from the work environment here,” he said, citing a “happy and healthy work environment, possibility to progress and expand.”

To contact the reporter on this story: Saleha Mohsin in Oslo at smohsin2@bloomberg.net

To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.net

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