A version of this article was originally published by Il Fatto Quotidano in Italian.
They come with their minds full of questions, Stavanger’s unemployed, today to the «Terminal», a glass palace in the city harbour. Passengers used to leave with ferries for Denmark and England from this dock. Today, some of the 822 that were invited here by the Employment Office may decide to leave, but to other regions of Norway. Regions that are fishing for workers.
Earlier this morning, Gry Kristin Joerstad Vist arrived. She is a civil servant for employment in the eastern Oppland county and has 30 positions to offer. Vist is looking for engineers, electricians and carpenters, something for every taste.
But to land one of these jobs, the unemployed must move to Oppland. “Yes, it’s tough, they have to change their lives and maybe leave their family. But it’s a job, it gives the person dignity, and that’s important”, says Truls Nordahl, Regional director of Nav, the powerful public employment system that manages pensions and especially employment policies. “The unemployed must show that they are actively looking for a job, or part of a training project. Otherwise we can cut the unemployment benefit”, says Nordahl.
Welcome to Rogaland, the hub of the Norwegian oil and gas industry. Until three years ago it was one of the most dynamic and self-assured regions in the country, where about half of the 200,000 oil workers used to live. Then, in the summer of 2014, the price of oil plummeted, from $ 115 a barrel to 100, then 80, then 60, down to today’s 52. Oil demand remained the same, but revenue more than halved. Rogaland was jerked out of its wonderland. In the following years, precariousness has entered the labour market in what is the engine of the Nordic welfare state.
Companies started to lay people off: Approximately 50,000 jobs were lost in three years. The regional unemployment rate rose from 2,6 to 4,7%. And when you lose a safe job and find yourself depending on a state benefit that ends after two years, with a mortgage to pay, you are scared. It is a sense of insecurity that precarious workers in Italy, Greece, Spain and elsewhere know very well.
Trygve (not his real name) is one Norwegian facing that vulnerable life. He used to work with maintenance on off-shore platforms, well paid, with planned and predictable rotation between weeks in the North Sea and off time back home. When oil prices collapsed, Trygve first found himself in mobility, neither employed nor unemployed, but in a gray area where he was called and paid only when the company needed him. This is system based in Norwegian law which can last for a maximum of twelve months.
Trygve did not complain. At least he got to work a lot, while many of his colleagues had already been laid off. However, “it was impossible to make plans between one mission and the next», he says. He had to be available and ready to take the helicopter offshore. The situation consumed both his body and mind. In the end, Trygve was laid off completely.
The «Norway» factor
The crisis kicks hard in this region. But we are in Norway, with a GDP per capita that is among the highest in the world (70.000 $ per year against 34.000 in Italy and 45.000 in Germany). Above all it is a stable country, so rich thanks to the discovery of oil in the North Sea in 1969. Since then this small country (population 5,2 million) of farmers, fishermen, shipyards and hydropower has changed profoundly. The Norwegians have been lucky. But they have also been pragmatic – and great savers.
In 1990, the «Oil fund», formally the Government Pension Fund Global, was created. It was set up to safeguard the proceeds of the black gold for future generations – and to prevent galloping inflation. Today it is the richest sovereign wealth fund in the world, with a capital of 698 billion euros, almost half of the Italian GDP. But drawing on the bulk of this money is a taboo for the Norwegians. At least so far. The government allows itself to spend up to 3 per cent of the value of the fund capital. This, together with a solid tax system, explains why Norway, like the other Scandinavian countries, continues to have a level of welfare that others can just dream of. And active employment policies that might inspire our politicians.
First, the whole public system works. Nav, the employment office, has 15,000 employees (in Italy, with a population of 60 million, there are 9,400 employees), Nav’s purpose is to pay pensions and unemployment benefits, but above all to help unemployed find new work.
“Look here,” Rogaland Nav director Truls Nordahl, tells me, showing me a map of Norway with many illuminated red lights. “These are the available jobs. Anyone who is registered by us can look at this site or ask us».
«But why should a company trust you, rather than look for the worker it needs on its own?»
«Because our services are free and good», says Nordahl.
«We first try to figure out if the individual has the right skills. We often recommend people to go back to school. In the petroleum industry, people were often hired before they had graduated, that’s how high the demand was. Today many find themselves without a diploma. If they return to study, the state lends them money to live, but is a loan, they have to invest in their future. We also organize training sessions. Then we propose jobs that are on offer in the market”.
Many oil engineers have had to accept lower earnings by taking on teaching jobs. Other workers found alternative jobs in the transport sector. A philosophy graduate can find himself in the supermarket checkout. It is a welfare under conditions.
And if the employer proposes only a fixed-term contract?
“We meet him and make a deal: He is committed to transforming that contract into a permanent job, and we pay the salary for the first six months”.
And if he changes his mind and no longer offers the job to the worker?
“It can happen,” says Nordahl, “but that company will lose credibility, and confidence, in the face of trade unions and workers. Trust is very important to us”.
The Norwegian model, in crisis?
This is the famous Norwegian model, a three-legged system of unions, employers’ associations and government. It is based on consensus, obtained after bitter clashes in the first decades of last century. In Norway, today’s “social model” is part of the identity of people and society, largely above party politics.
“Every year, in May, we negotiate the level of wages for the next year,” says Ommund Stokka, member of the national board of Industri Energi, the biggest oil workers’ union.
“The first round of negotiations is done at the national level and concerns the export sector: If it is a good year, everyone profits, otherwise the parties show moderation”.
Spring is the only time of the year in which strikes can legally take place. Between negotiated agreements, the parties stick to their agreement.
“The secret of our model is that there is not too big a difference between the earnings of a CEO and a worker,” says the Nav director.
“People have learned the benefits of compromises that put them in the same boat. But if I earn ten times more than you, we are not in the same boat».
Truls Nordahl, who runs an office of 700 people, earns € 110,000 a year, approximately twice that of ordinary Nav employees. The Norwegian Prime Minister earns 170,000.
The model dates back to 1935 and a «Basic agreement» signed by unions, employers’ association and government. Did the oil crisis put it in danger?
“Yes, the model is threatened”, says Bjorn Asle Teige. He represents Safe, the traditionally most radical of the oilworkers’ unions, and is a corporate union representative in the powerful state-owned Statoil, with 20,500 employees worldwide.
“Before, the dialogue worked. We found solutions together. Now there is a much stronger pressure from the top. We don’t meet with human relations people anymore. We are met with lawyers», says Teige.
Statoil is privatized at 33%, there are shareholders and global competition. During these three years of crisis, Statoil has reduced its staff by 5,000 people. Bjorn Asle Teige fears that the next 500 announced layoffs offshore will transform previously stable jobs to temporary contracts without pay between assignments. He sees this development as a disaster, both for workers’ safety and for the production levels.
“There are more and more foreign workers in the platforms, for example British citizen, registered in a temp agency in Singapore, coming to work in Norway”, says Ommund Stokka of the Industri Energi union. He once went to Asia to look into the conditions of such temp agencies. “Many oil workers are being fired and then contracted by these temp agencies for the same kind of work. We do not have a union presence in these agencies. Now we are trying to get in”.
The Norwegian state is defending itself as it can. Last year it forced the oil company Eni to close their Goliat platform in the Barents Sea, outside the northermost tip of Norway, accusing the Italian company of not respecting Norway’s safety standards. There were 34 «unwanted incidents» on this platform, which was built in Korea and transported all the way to Norway from there.
Oslo fights back
The Norwegian idyll is also threatened in the country’s capital. Every year, 10,000 more people come to live in Oslo, and the construction sector has been booming. And here too, temp agencies have mushroomed.
“The six largest temp agencies in the construction sector have six times more workers than the six biggest construction companies”, according to Ommund Stokka, the trade unionist.
Employment is still the norm in Norway – only 6 % are self-employed (compared to 26% in Italy and 31% in Greece). The employers’ assosiation, NHO, assured us during a meeting in Stavanger: “Permanent contracts must remain the rule, though not necessarily full time jobs”.
But the laws in place have not been sufficient to prevent criminal actors from exploiting workers in the construction business. Raymond Johansen, the head of the red-green Oslo city council, has now launched the «Oslo model», a package of hands-on measures to stop social dumping on municipal construction sites. The city, which is the second biggest public purchaser in Norway, wants to use that power to «put the city in the frontline of the struggle for a serious and decent labour market». This some of the measures: ontractors must have permanent employees in minimum 80% of the positions; every worker must be electronically registered from day one; all workers will have wages and conditions equal to minimum rates or national tariff agreements; all pay to the worker will be done electronically, no cash allowed.
So, is it possible to stop precariousness from spreading?
«Sure!», says Ommund Stokka.
«Politicians and the state can do a lot. They may limit the power of temp agencies by allowing them to be used only under temporary circumstances, such as maternity or illness. A company’s productivity will improve, because people are more motivated if they are part of the staff. ”
The labour issue has been promoted by the opposition Labour Party in recent general elections. But even the conservative government party used it as a campaign topic. Labour minister Anniken Hauglie promised before the summer a new labour reform to ban so-called “zero hours” contracts, where workers are only paid for assignments and not between them. Labor protection is crucial in this country. It goes with the Norwegian model, the cement of this society.
Norway in Figures
Expenditures for welfare:
37% of state budget,
Cost of labour policies:
23% of welfare
Employment service employees:
15,000 for 5,2 mill hab.