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Norway – Staffing market sees moderate growth

23 May 2012

The staffing market in Norway is seeing growth but is far from experiencing a boom, according to the Norwegian National Federation of Service Industry (NHO).

The NHO found that, in the first quarter, the staffing market saw a 5.4% increase in hours worked in the staffing industry, which takes it back to the same level achieved in 2007. But the organisation warned that “there is still some way to go” for the staffing market to reach its peak level experienced in 2008.

In the quarter, staffing revenue amounted to roughly €394 million, a +10% increase from a year ago. The penetration rate (temporary agency workers as a proportion of the total workforce), which usually floats around 1% in Norway, was slightly above the average at 1.12%.

The construction industry was more or less the saviour, seeing +43% growth –  without the strong demand for temporary labour in this one sector, the overall market growth rate would have actually dropped by -1.7%. This sector is usually prone to seasonal fluctuations and has increasingly become reliant on temporary staff due to the current skills shortage.

Similarly for the technical sector, where there is also a lack of skilled labour, the staffing sector has recorded strong year-on-year growth of +36% in the first quarter.

But things are not looking as rosy in other industry sectors. The public sector has seen a decline in the quarter although the NHO predicts this will not persist. It also warned that half of the occupational areas in Norway have seen a decline in the staffing market, including healthcare, manufacturing, trade, education and finance.

 “We are a little surprised that we do not see a general increase in the staffing industry, as the unemployment rate in Norway is so low. Low unemployment has previously provided good times for staffing agencies,” said the head of the NHO, Even Hagelien.

The Norwegian staffing market is slightly more fragmented than the Swedish one and the top five firms represent just under half of the market in terms of revenue. Global giants Adecco and ManpowerGroup occupy the top 2 positions, followed by five staffing firms headquartered in Scandinavia, according to Staffing Industry Analysts.

To read the full report by the NHO in Norwegian, click here.

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