Norway Warns Labour Shortages Pose Biggest Threat to Economy; Reforms Planned

Ministers Jens Stoltenberg and Kjersti Stenseng warned that a shortage of labour is the biggest threat to the Norwegian economy, noting that the working-age population has stopped growing for the first time since the Black Death. The government is planning welfare reforms and a 6.4 billion kroner income tax cut to encourage more people to join the workforce. Stenseng also noted that roughly 700,000 people in Norway currently remain outside employment and education.

The government's response to the demographic shift involves major fiscal and social policy changes, including a significant income tax cut and reforms aimed at increasing workforce participation. This addresses the challenge that future population growth will primarily come from older residents, requiring existing workers to work more.

Norwegian government bodies are discussing proposals aimed at improving the country's labor market efficiency.