Continued growth in the Norwegian pr-sector

The Norwegian economy is currently in a phase of high activity and a very positive market situation. For the fourth consecutive year, 2007 saw a growth in demand exceeding the long term trend of 2.5 percent.  In 2007 employment grew by 80 000 persons. Even so, a recent survey shows that enterprises choose to replace Norwegian sub-sub suppliers with foreign ones.

Years of strong growth in the Norwegian economy have their background in that Norway as a producer of raw materials and intermediate goods has profited from globalization. Growth in countries like China and India has increased demand for energy and other raw materials. In combination with moderate import prices this has led to Norway’s disposable revenues increasing significantly. Household purchasing power has increased, enterprises’ profitability and willingness to invest have been given a boost and government has been given an unprecedented financial situation.

However – NHO (The Confederation of Norwegian Enterprise) reports that fewer member companies have faith in continued improved market developments for 2008. There is less optimism in the process - and building industries. Activity levels will remain high, but Norwegian economy, like most other economies, is expecting an increased level of uncertainty.

The general economic situation is reflected in The Norwegian Public Relations Consultants Association’s (NPRCA/NIR) forecasts. Although member agencies report an increase in order intake and revenues above last year and projections for 2008 foresee a continued growth, there is an uncertainty as to how the international economic downturn will affect the Norwegian PR-market.

An analysis conducted by NPRCA/NIR in 2007 indicated total revenues for the PR-sector in Norway of NOK 740 million (Euro 92.5 million). Overall growth from 2006 to 2007 amounted to 12 percent, with an average profit margin of 15 per cent. As a general trend, the 10 largest agencies grew faster than the smaller ones.

Hauk Lund

President
NPRCA/NIR
Hollis Europe 2008