Norwegian Ministry
of Local Government and Modernisation
Anne-Merete Halpern 31stMay 2018
Regional development in Norway – what are the challenges?
What is a rural municipality?
• Municipalities that are remote (have small populations and markets, as well as long distances to other or larger centers)
• The Norwegian Centrality Index (Statistics Norway) classify municipalities, based on access to service functions and labour markets
• Centrality level 5 and 6 can be classified as rural areas
• 238 municipalities (out of 422)
• 72 percent of the land area
• 14 percent of the population
Kommunal- og moderniseringsdepartementet
Other challenges follow on from the geographical challenges
• Demography
• Economic growth
• Less central areas typically experience lower growth, but some of these municipalities can also have significant growth
Hemsedal Finnøy Austevoll Hitra Frøya
Gamvik
R² = 0,5228
‐20%
‐10%
0%
10%
20%
30%
40%
50%
200 300 400 500 600 700 800 900 1000
Populationgrowtn, percent
Centrality Index
The Norwegian Centrality Index – population growth
Kommunal- og moderniseringsdepartementet
Employment growth is lower in rural areas
• Employment growth is used as an indicator for economic growth
• Significant variation between municipalities
• Lower growth or decreasing employment in less central
municipalities R² = 0,1994
‐30%
‐20%
‐10%
0%
10%
20%
30%
40%
200 300 400 500 600 700 800 900 1000
Employmentgrowth, percent
Centrality Index
The Norwegian Centrality Index – employment growth
Kommunal- og moderniseringsdepartementet
Demographic challenges in rural areas
• Low population growth or decline
• Birth deficit
• Domestic out-migration
• Gender imbalance, more men than women
• High proportion of elderly people
• But high levels of immigration
7,5
5,7 5,4
3,0
0,6
‐0,7
‐8,0
‐6,0
‐4,0
‐2,0 0,0 2,0 4,0 6,0 8,0 10,0
1 ‐ most central 2 3 4 5 6 ‐ least central
Net domestic migation Net immigration Net birth rate Total population growth
Lower population growth in recent years due to reduced immigration and number of births
10000 20000 30000 40000 50000 60000 70000
Population growth per quarter, national level
Kommunal- og moderniseringsdepartementet
Reduced population growth in all levels of centrality
‐2000
‐1000 0 1000 2000 3000 4000 5000 6000 7000 8000
2000K1 2001K1 2002K1 2003K1 2004K1 2005K1 2006K1 2007K1 2008K1 2009K1 2010K1 2011K1 2012K1 2013K1 2014K1 2015K1 2016K1 2017K1 2018K1
Population growth, 1.quarter, by level of centrality
1 2 3 4 5 6
Kommunal- og moderniseringsdepartementet
Other challenges are not predominantly rural challenges
y = 3E‐05x + 0,6359 R² = 0,0088
0%
10%
20%
30%
40%
50%
60%
70%
80%
0 100 200 300 400 500 600 700 800 900 1000
Centrality‐ levels of employment
y = 0,0043x + 71,011 R² = 0,0075
0 100 200 300 400 500 600 700 800 900 1000
Centrality – proportion of young adults who have at least completed upper secondary education
Kommunal- og moderniseringsdepartementet
Covaration of challenges
• Population growth, employment growth, old age dependency ratio
• Level of employment, education (proportion of young adults who have at least completed upper secondary education), life expectancy (males)
78 of 83 municipalities with low growth/high dependency ratio is at centrality level 5 and 6. 10 out of 84 with high growth/low dependency ratio
Kommunal- og moderniseringsdepartementet
60 of 81 municipalities with low utilisation of human resources and weaker health are at centrality level 5 and 6. 49 of 75 with higher utilisation of human resources and good health
Kommunal- og moderniseringsdepartementet
General policy responses
• Growth-promoting tax cuts
• Development of infrastructure
• Public sector innovation and rationalization
• General transfers to local and regional level
Kommunal- og moderniseringsdepartementet
Regional structure
• 18 counties
• 11 from 2020
• 422 municipalities
• 356 from 2020
• Geographically differentiated employer tax
• Measures for innovation and entrepreneurship
• Loans and grants to promote business investments
• Measures for local community development Employer tax in % of salaries:
Regional and rural policy measures
Kommunal- og moderniseringsdepartementet
More than 600 state jobs
58 1
70 65
10 23
43
15
20 6
55 27
60 123
8 35
Sykehusinnkjøp HF
Klageorgan for helse Nasjonal IKT HF Konkurranseklagenemda
Forbrukerrådet
Vernepliktsverket Norsk kulturråd
Sykehusbygg HF Kreativt Norge Statlige oppgaver,
Herunder Politiets Lønns- og regnskapssenter
Norsk helsearkiv Parkeringstilsynet
Vernepliktsverket
Regelrådet
Sivil klareringsmyndighet Valgdirektoratet
Skatteklagenemda Nye veier AS
Decided or established outside of Oslo
Partistøtte
Norwegian Ministry
of Local Government and Modernisation
