Expect annual wage growth of 5.1 percent – ​​E24

Expect annual wage growth of 5.1 percent – ​​E24

Just before the wage settlement breaks down, the distance between the two parties increases sharply.


Parties in working life expect the average annual wage growth in the current year to reach 5.1 percent, unchanged from the previous quarter. According to Norges Bank Survey of new forecasts for the first quarter.

  • Employer organizations expect annual wage growth of 4.7 percent, down 0.5 percentage points from the previous quarter.
  • Employee organizations expect average annual wage growth this year to be 5.4 percent, up 0.3 percentage points from the previous quarter.

Employers have lowered their expectations for wage growth, while employees have raised the same expectations, says Kyrre M. Knudsen at SpareBank 1 SR-Bank.

– Perhaps the increasing distance between the two parties makes it clear that reconciliation of wages can be difficult, he says.

Staff organizations have been clear about this Real wage growthReal wage growthWhen wages rise more than prices, workers generally have more to deal with. Wage growth and price growth therefore determine whether people will have increased purchasing power, or real wage growth. This is the most important requirement this year. Working parties collectively expect real wage growth this year to average 0.6 per cent, according to Norges Bank.

– The interest rate will not fall anytime soon, this is the conclusion after surveying expectations, chief economist Marius Hof at Handelsbanken tells E24.

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Expect weak price growth

The survey measures the opinions of economists, stakeholders in working life, business leaders and households on the development of wages, prices and employment, among other things. It is performed four times a year.

The survey was conducted between October 13 and November 3, 2023.

It was before that Preliminary report From the Technical Accounts Committee (TBUTBUCommittees that submit reports related to salary settlement every year. The reports include an overview of wage developments, developments in the Norwegian economy and estimates of price growth before wage adjustment. The TBU consists of representatives of central organizations in working life, Statistics Norway and several ministries.) with estimates of a 4.1 percent price increase for 2024.

Before salary adjustment each year, TBU submits a report. There are key figures and analytical material about the Norwegian economy which should give parties in working life the same basis to deal with in wage settlement.

In the Norges Bank survey, working parties expect prices for goods and services to increase in 12 months by 4.3 percent, a decrease of 0.6 percentage points from the previous quarter.

  • Employer organizations expect a price increase of 4.1 percent, down 0.6 percentage points from the previous quarter.
  • Employee organizations expect a price increase of 4.5 percent, a decrease of 0.7 percentage points from the previous quarter.

– Supports postponing interest rate cuts

Economists, business leaders and households also expect prices to rise less than previously over the next 12 months, compared to the third-quarter survey.

  • Business leaders expect a 4.7 percent price increase.
  • On average, households believe that prices will rise by 3.3 percent.
  • Economists expect a price increase of 3.9 percent.
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Handelsbanken signs Twitter Inflation expectations are firmly entrenched.

The Bank of Norway announced that the first interest rate cut will be postponed, and these numbers support that, the bank wrote.

Inflation expectations affect the economy in many ways, including through saving and investment decisions, corporate pricing and wage negotiations, and are therefore very important for setting interest rates.

The price increase was well above Norges Bank's target of 2 per cent. The central bank responded by raising its key interest rate sharply, most recently in December to 4.5 percent. Wage growth can have an impact on interest rate expectations.

Dalila Awolowo

Dalila Awolowo

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