Norwegian industrial managers report growth in production in manufacturing in the 3rd quarter. New orders from both the domestic and export markets were unchanged. The general expectations for the 4th quarter of 2024 are positive for all types of goods.
The business tendency survey for the 3rd quarter of 2024 shows that overall manufacturing production increased moderately, but there are large sector differences. Producers of Covers industries such as wood and wood products, paper and paper products, basic chemicals and basic metals. Often referred to as traditional export industries. and Covers industries such as food products and beverages, printing and reproduction, pharmaceuticals and furniture.report unchanged production. The producers of Covers industries such as machinery and equipment, ships, boats and oil platforms, repair and installation. Often referred to as the engineering industry. are still experiencing a clear increase in production.
After a period of about two years with unchanged or slightly declining manufacturing output, the assessments from manufacturing leaders show growth in production volume over the past 2 quarters. The growth is driven by high activity in the supplier industry, which can be linked to the high oil and gas investments. At the same time, the results for building of ships, boats and oil platforms show a lower growth rate in production development and that new orders have decreased in recent quarters.
Industrial leaders report growth in total industrial employment in the 3rd quarter. It is the producers of capital goods that are responsible for the growth. Producers of consumer goods and intermediate goods report unchanged employment.
Figure 1. Production and employment for manufacturing. Changes from previous quarter. Smoothed seasonally adjusted
Line chart with 3 lines.
The chart has 1 X axis displaying Quarter.
The chart has 1 Y axis displaying Diffusion index. Data ranges from 39.11 to 56.45.
Turning point value
Total volume of production
Average employment
End of interactive chart.
Figure 1. Production and employment for manufacturing. Changes from previous quarter. Smoothed seasonally adjusted
Overall, industrial leaders report that new orders from the domestic market are unchanged in the 3rd quarter. Producers of intermediate goods report a decline in new orders from the domestic market, while the majority of producers of consumer goods report a moderate increase. For producers of capital goods, new orders from the domestic market are reported to be unchanged. This applies to producer consumer goods and intermediate goods, while a moderate rise is reported for producer of capital goods.
Total stock of orders is unchanged in the 3rd quarter compared to the previous quarter. Producers of intermediate goods report a fall in the total stock of orders, while producers of consumer goods report a moderate increase. For capital goods, the total stock of orders is reported to be unchanged.
Figure 2. New orders received for manufacturing. Changes from previous quarter. Smoothed seasonally adjusted
Line chart with 3 lines.
The chart has 1 X axis displaying Quarter.
The chart has 1 Y axis displaying Diffusion index. Data ranges from 41.2 to 58.59.
Turning point value
New orders received from home markets
New orders received from export markets
End of interactive chart.
Figure 2. New orders received for manufacturing. Changes from previous quarter. Smoothed seasonally adjusted
Many industrial managers are reporting significant growth in the prices, both in domestic and export market for overall manufacturing in the 3rd quarter. Price growth is reported within all the types of goods, but the growth is clearest for the producers of consumer goods.
Figure 3. Prices on products for manufacturing. Changes from previous quarter. Smoothed seasonally adjusted
Line chart with 3 lines.
The chart has 1 X axis displaying Quarter.
The chart has 1 Y axis displaying Diffusion index. Data ranges from 47.8 to 74.12.
Turning point value
Prices on products at home markets
Prices on products at export markets
End of interactive chart.
Figure 3. Prices on products for manufacturing. Changes from previous quarter. Smoothed seasonally adjusted
A large number of manufacturing leaders report continued growth in The development in the prices that the company pays for the goods and services that are included in the production (product input), and on the prices of production equipment and facilities used in the production process. in the 3rd quarter. Producers of consumer goods and intermediate goods that have the clearest growth in cost prices. Since the rise in cost prices is more pronounced than for product prices, it is not surprising that there are reports of falling The development in the profitability of the company's sales of goods or services. Profitability means the change in the difference between current operating expenses and current operating revenues.in manufacturing in the 3rd quarter. However, fewer than in previous quarters report lower profitability.
Positive expectations for the 4th quarter of 2024
The general outlook for the 4th quarter of 2024 is positive for manufacturing. The producers of all types of goods are optimistic, but producers of capital goods are most positive about the coming quarter.
Manufacturing leaders expect higher production volumes and growth in average employment in the 4th quarter, compared with the 3rd quarter. An increase in new orders is expected from both the domestic and export markets. The total stock of orders is also expected to increase in the 4th quarter.
It is the producers of capital goods who report the best future prospects. They still expect continued clear growth in production and employment, and growth in new orders from both markets, and an increase in the total stock of orders.
The producers of intermediate goods and consumer goods report somewhat weaker future prospects. Both expect moderate growth in overall production and new orders from both markets, and unchanged stock of total orders. For consumer goods, employment is expected to be somewhat lower in the 4th quarter.
It is also expected that cost prices and prices of products sold to both the domestic market and the export market will continue to increase in the 4th quarter.
Figure 4. General judgement of the outlook in next quarter for manufacturing.
Line chart with 2 lines.
The chart has 1 X axis displaying Quarter.
The chart has 1 Y axis displaying Diffusion index. Data ranges from 39.8 to 59.49.
Turning point value
Smoothed seasonally adjusted
End of interactive chart.
Figure 4. General judgement of the outlook in next quarter for manufacturing.
Manufacturing leaders report that investment plans remain unchanged for manufacturing as a whole. The proportion of manufacturing managers who believe that prices The prices of the investment goods (production equipment and facilities used in the production process) that the company purchases are so high that it limits the implementation of planned investments. are a limiting factor on investment is still relatively high
The industrial confidence indicator signals lower growth in the 4th quarter
This is the average of the responses (balances) to the questions on expected volume of production, total stock of orders and inventories of own products for sale (the latter with an inverted sign). See Definitions in ‘About the statistics’ for further details. in the 3rd quarter of 2024 was 1.5 (Figures that are adjusted for calendar effects and seasonal variation. Such adjustment gives a more accurate picture of the underlying trend in the time series and makes it easier to compare the results of subsequent quarters.-adjusted) which is down from 3.5 in the previous quarter. The indicator is now above the historical average of 2.9.
The industrial confidence indicator indicates lower production in the coming quarter for producers of intermediate goods. For producers of capital goods and consumer goods, it gives indications of increased overall production in the 4th quarter.
Values above zero indicate that total output will grow in the forthcoming quarter, while values below zero indicate that total output will fall. International comparisons of the industrial confidence indicator are available from Eurostat (EU),The Swedish National Institute of Economic Research and Statistics Denmark.
Figure 5. Industrial confidence indicator¹
Line chart with 2 lines.
The chart has 1 X axis displaying Quarter.
The chart has 1 Y axis displaying Net figures. Data ranges from -18.1 to 10.6.
Seasonally adjusted
Average 1990-2024
End of interactive chart.
Figure 5. Industrial confidence indicator¹
Quarter
Seasonally adjusted
Average 1990-2024
Q1-2015
-3.6
2.9
Q2-2015
-9.3
2.9
Q3-2015
-6.4
2.9
Q4-2015
-8.2
2.9
Q1-2016
-6.6
2.9
Q2-2016
-3
2.9
Q3-2016
-3.6
2.9
Q4-2016
-0.5
2.9
Q1-2017
1.6
2.9
Q2-2017
2.5
2.9
Q3-2017
3.8
2.9
Q4-2017
6.5
2.9
Q1-2018
6.9
2.9
Q2-2018
8.8
2.9
Q3-2018
9.2
2.9
Q4-2018
8.9
2.9
Q1-2019
7.3
2.9
Q2-2019
5.3
2.9
Q3-2019
1.9
2.9
Q4-2019
0.3
2.9
Q1-2020
-18.1
2.9
Q2-2020
-10.1
2.9
Q3-2020
3.2
2.9
Q4-2020
4.5
2.9
Q1-2021
6.9
2.9
Q2-2021
10.6
2.9
Q3-2021
10.3
2.9
Q4-2021
9.5
2.9
Q1-2022
6.6
2.9
Q2-2022
2.2
2.9
Q3-2022
-4.1
2.9
Q4-2022
-2.6
2.9
Q1-2023
-1
2.9
Q2-2023
-5.9
2.9
Q3-2023
-2.1
2.9
Q4-2023
-4.1
2.9
Q1-2024
0.6
2.9
Q2-2024
3.5
2.9
Q3-2024
1.5
2.9
¹ Industrial confidence indicator is the arithmetic average of the answers (balances) to the questions on production expectations, total stock of orders and inventories of own products (the latter with inverted sign).
The proportion of industry leaders reporting that weak demand and strong competition limit is still relatively high but has fallen slightly compared to the share in the previous quarter. At the same time, historically speaking, there is still a high proportion of manufacturing managers who point out that a lack of qualified labor is a factor that contributed to limiting production in the 3rd quarter. The sum of percentages for those who have reported that lack of qualified labour and raw materials/electric power limits production, plus the percentage of establishments with capacity utilisation above 95 per cent. which was very high in connection with the pandemic, has stabilized at lower levels in the past year.
Figure 6. Bottlenecks in production in current quarter. Smoothed seasonally adjusted. Per cent
Line chart with 4 lines.
The chart has 1 X axis displaying Quarter.
The chart has 2 Y axes displaying Per cent (Demand and competition) and Per cent.
Demand and competition (left axis)
Supply of labour
The capacity of plant
Supply of raw materials and/or electric power
End of interactive chart.
Figure 6. Bottlenecks in production in current quarter. Smoothed seasonally adjusted. Per cent
The average How much of the available production capacity is utilised. A high capacity utilisation means that it is difficult to produce more without investing, while a low capacity utilisation means having capacity that is not being used. for Norwegian manufacturing was calculated to 78.3 per cent at the end of the 3rd quarter. This is marginally lower than at the end of 2nd quarter. The capacity utilisation is still at a lower level than the historical average of 80.0 per cent. International comparisons of average capacity utilisation are available from Eurostat (EU).
Figure 7. Capacity utilisation in per cent for manufacturing.
Line chart with 2 lines.
The chart has 1 X axis displaying Quarter.
The chart has 1 Y axis displaying Per cent. Data ranges from 76.1 to 81.2.
Smoothed seasonally adjusted
Average 1990-2024
End of interactive chart.
Figure 7. Capacity utilisation in per cent for manufacturing.
Norway is heading towards an economic boom. Meanwhile, inflation is at a record high. A rapid rise in interest rates can therefore be expected in the period ahead. Combined with reduced prospects globally, this will slow economic growth in Norway.
The survey monitors the development in estimated and final investments within oil and gas activities, manufacturing, mining & quarrying and electricity supply.
