The projections of supply and demand are based on assumptions about the development in demographics and macroeconomic conditions.
The projection of the labor supply (defined as the workforce) by education is based on assumptions about the expected demographic development and the educational choices of individuals, and is done using the MOSART model. The results for the projected labor supply show a clear increase in the educational level of the workforce in the years leading up to 2050.
The projection of the demand for labor (defined as employment) by education is based on expectations about the development of the international economy, fiscal policy, and the extent of petroleum activities in the Norwegian economy, and is done using the KVARTS model. Similar to the supply side, the projection of the demand for labor shows that companies will demand more and more people with higher education in the years leading up to 2050.
The supply and demand for labor by education are projected separately, and there are therefore no mechanisms in these projections such as wage adjustment or substitution between different types of labor that push towards an equilibrium between supply and demand. As a result, the difference between supply and demand during the projection period should not be interpreted as projected unemployment or labor shortage.
The projections show that the demand will be higher than the supply for labor with vocational education aimed at industry, construction, and crafts, healthcare workers, and nurses. An already observed shortage in these three fields may therefore be exacerbated unless measures are taken to counteract this or equilibrium-inducing mechanisms come into play. The projections also show a higher growth in projected supply than in projected demand for several educations at the bachelor’s and master’s level, including humanities, social sciences, and economics and administrative subjects, as well as science and technology.