Norwegian construction industry set to grow in 2023 despite inflation and material costs

The construction industry in Norway is expected to grow by 0,8 % in real terms in 2023, driven by increased investments in the oil and gas sector. This growth is supported by temporary tax breaks, higher oil prices, and Europe-wide gas shortages, triggered by the Russia-Ukraine crisis. However, rising inflation and surging construction material prices could pose significant downside risks to the industry’s output in 2023.

Although the recent increase in the benchmark interest rate and the possibility of further rate hikes could weigh on investor and consumer confidence, the Norwegian construction industry is expected to record an annual average growth rate of 2.3% from 2023 to 2026, driven by investments in the transport and renewable energy sectors.

The Norwegian government’s roadmap to drive green industrial growth in the country will likely play a crucial role in supporting the construction industry’s growth over the coming years.