Regional industry snapshot: Ocean industries are coping best

These are the key findings in Vestlandsindeksen - the regional bank Sparebanken Vest’s quarterly monitoring on how the region’s industries are performing and their future expectations.

The larger companies, with a turnover of more than NOK 50 million are doing better than the smaller companies.

Counter-cyclical

With its long history with the ocean, Greater Bergen has created successful, state-of-the-art export industries within aquaculture, energy, and shipping. In recent years, progressive digitalisation has developed new industries within the region.

This experience in the ocean industries allows for a great deal of crossover, which has been key to the growth and development of these industries, as well as for creating new opportunities. These industries are also relatively speaking doing better in today’s economic climate.

– If we compare our region with the economy in rest of the world, the Western Norway is counter-cyclical at the moment. The key industries in our region are ocean based, and these industries are performing best as of now. Businesses involved in maritime industry deliver especially good results. They also have higher expectations for future results than other industries. For everyone with low or no share in maritime activity results and expectations for 2024 are declining, says Margunn Minne EVP/Head Corporate market at Sparebanken Vest in a comment.

A high oil price and a weakened Norwegian currency explain some of the good results.  

In construction and civil engineering, the index is showing that industries own expectations are lower than they were even during the pandemic.

The graph is showing the region’s historical financial results and the companies future expectations. Source: Sparebanken Vest.

Unchanged unemployment rate

Even if the businesses expect the results to continue to fall in 2024, the do not report an expected drop in hiring and employment.  This could be due to the fact that companies are expecting better times.

- Employment is holding up. People are not losing their jobs on a large scale, so most people can still service their obligations, says Minne. 

Also industry investments are expected to be kept at the same level. The investment rate in the North Sea has remained high in recent years and is expected to rise in 2024. Businesses with a high share of activity linked to oil and gas prove to be more resilient than others and have positive expectations well above the historical average.