Employment in the petroleum industry

In 2016, 185 300 people were directly or indirectly employed in the Norwegian petroleum sector, about 47 000 less than in 2013 (or a decrease of about 20%). The reduction stems from a lower activity level in the oil and gas industry, both domestically and globally.
In 2016, 185 300 people were directly or indirectly employed in the Norwegian petroleum sector, about 47 000 less than in 2013 (or a decrease of about 20%). The reduction stems from a lower activity level in the oil and gas industry, both domestically and globally.
Overall employment Direct employment Regional employment

Employment in the oil and gas industry dropped in 2015 and 2016 after several years of strong growth. It is challenging to estimate precisely the number of people employed in the sector, because it is complicated to separate deliveries of petroleum-related goods and services and deliveries to other industries. Furthermore, it is even more complicated to estimate indirect employment, in other words employment generated in other parts of the economy by demand from the petroleum industry.

Various definitions and methods give different estimates of the total number of people employed in the oil and gas industry. You will find a brief summary in this article.

In 2016, 185 300 people in Norway were directly or indirectly employed in the petroleum sector

Direct and indirect employment

Statistics Norway estimates that 185 300 people were directly or indirectly employed in the petroleum industry and petroleum-related industries in 2016. This figure corresponds to about 7 % of total employment in Norway. The figures are estimated by input-output analysis, and Statistics Norway describes this method in the report Spillover-effects from the offshore petroleum to the mainland economy. By way of comparison, their previous estimates on the number of employees in 2013 and 2015 were respectively 232 000 and 206 000. The data collected by Statistics Norway do not allow for a meaningful distinction between direct and indirect employment in the petroleum sector.

Indirect employment is a result of demand from the petroleum industry for goods and services in a variety of sectors, including wholesale and retail, IT equipment and services, employment agencies, renting of machinery and equipment, hotel and restaurant and legal and accounting services.

IRIS, the International Research Institute of Stavanger, published a survey of employment in the industry, funded by the Norwegian Oil and Gas Association. The report shows a total of 330 000 directly or iated industries in 2014. Ondirectly employed in the petroleum and petroleum-relf the total, 186 000 were directly employed and 144 000 indirectly in related industries. Compared to Statistics Norway the report also includes employees involved in suppliers’ export activities and employment resulting from suppliers’ own investments. In March 2016, IRIS published updated figures for direct employment for 2015. The survey shows the number of people directly employed by the oil and gas industry dropped by 22 000, largely because of lay-offs in the petroleum-related supply industry.

A third study by SNF (Centre for Applied Research at the Norwegian School of Economics), funded by the Ministry of Petroleum and Energy, estimated that about 145 000 people were directly employed in the petroleum sector in 2015, about 28 000 in oil and gas companies and 117 000 people in service and supply companies. This is about 8000-9000 employees lower than the estimate in a similar study by the same centre from 2012. However, employment rose from 2012 to 2014, and did not drop until 2015.

Direct employment

The illustration below, based on data from National Budget and SSB, illustrates the direct employment in the oil and gas industry since the early 1970's. Employment in companies not fully targeted towards the upstream sector are not included in these figures. This includes the major parts of the oil service and supply industry. From 1972 to 2014 the employment increased from 200 to 66 000. The illustration also captures the first ever drop in employment from 2014 to 2016.

Number of employees in the Norwegian petroleum sector, 1970-2016

Updated: 20.02.2017

Source: Statistics Norway - Annual national accounts (table 18)

Print illustration Download data Number of employees in the Norwegian petroleum sector, 1970-2016 Download PDF Download as image (PNG)

Number of employees in the Norwegian petroleum sector, 1970-2016

Regional employment in the Norwegian oil and gas industry

Regional employment and local value creation have been long-standing objectives for Norwegian oil and gas policies. This has contributed to making Norway a global front-runner in a number of areas. Regional employment is especially high on in western parts of Norway, particularly in Rogaland and the Stavanger-region. As the shelf has matured and offshore activities have moved north, so has the activities onshore. Currently, world leading oil and gas clusters and a global competitive oil service industry exists in many parts of the country. According to IRIS, there were employees in petroleum-related industries in 415 of Norway’s 428 municipalities at the end of 2014.

Lower activity and weaker demand from the petroleum industry, both in Norway and globally, had major impacts on the oil service and supply industry. Reducing staff costs and number of employees have been necessary to cut costs and adapt to the lower activity level. The greatest impact has been in western and southern Norway, where a higher proportion of total employment is linked to oil and gas activities.

The oil service and supply industry

The oil service and supply industry is present in all parts of the country. It employs most people in the Stavanger-region, where there are companies offering a wide range of goods and services. In other parts of the country, there are often clusters of companies in the same segment within a limited geographical area.

The Oslo-region has a well-established engineering expertise and a cluster of seismic companies. Trondheim has a strong position in research and education, while the Bergen has become a centre for maintenance and subsea equipment. In Buskerud, especially in Kongsberg, a strong cluster has developed related to subsea technology, automation and dynamic positioning equipment. In Southern Norway, there are world-leading companies in drilling technology, and the Ålesund-region, has maritime companies that provide a complete shipbuilding and outfitting cluster, for example for advanced offshore vessels.

Bodø Science Park publish a report on the petroleum sector in the three most northern counties; Nordland, Troms and Finmark. The annual report is based on surveys of 200 companies. In 2015 the report concluded that 2 210 people were engaged in deliveries to the petroleum sector. This represents a decrease of nearly 20% compared to 2014.

Updated: 02.10.2017