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Patterns of recruitment to the Oil Industry in Norway
Geoforum,
Vol. 8, pp. 201-218,
1977. Pergamon
Press. Printed
Patterns of Recruitment
of Geography, Houghton
Street,
London School
of L.ondon WCZA 2AE
England
A moderate rate of offshore activity is thus one of the main features of Norwegian oil policy. This is interpreted by the Government as a production ceiling of 90 million tonnes of oil equivalents per annum. However, technical problems, increasin~y stringent safety regulations and incidents, such as the Ekofisk Bravo blow-out in April 1977, have meant that an interim production peak has been naturally imposed and that the official production ceiling is now unlikely to be reached before 1987.
The oil and gas discoveries have introduced a new element into the Norwegian economy which represents new opportunities to the trade and industry sectors and new potential for the economic development of the country (NORDHUS, 1976). The oil related developments create problems, however, in the sense that they require resources which are already in use in other sectors of the economy, manpower being a particular example.
Economics, England.
in Norway
blessing. Rapid development could cause structural disiocation in the economy, together with environmental damage, and too rapid an injection of the revenues into the domestic economy will produce considerable inflationary pressures.
As a country with few natural resources, but with an extensive coastline, Norway has traditionally looked to the sea for its livelihood. Both the fishing grounds and the merchant marine have been major contributors to Norway’s wealth. The discoveries of oil and gas in the Norwegian sector of the Continental Shelf in the late 1960s and early 1970s have added yet another dimension to the importance of offshore areas to the economy of Norway.
* Department
Britain.
to the Oil Industry
SUSAN SQUIRES,*
Much of the debate surrounding the impact of North Sea oil has centred upon the indirect effects that the revenues, from taxes, royalties and direct state participation in production, will have on the economies of the various countries concerned (HOPE, 1975). In Norway, the promised revenue, which is expected to be in the order of US$20003000 millions per annum by 1981/2 (St. Meld. Nr. 25, 1973374) is seen as a means of assisting development in the country’s less prosperous regions. In addition it could permit the repayment of foreign debts and investments overseas and may also allow foreign aid contributions to be increased more easily. To date, no priorities over such policies have been established. Nevertheless, despite such obvious benefits, the oil related activities are seen very much as a mixed
in Great
In addition to the alarm expressed about the absorption of large revenues into the economy, fears have also been expressed that a rapid rate of growth in offshore activity could cause too rapid structural changes in the economy. This in turn could have unfavourable consequences for the pattern of population and economic activity as well as for social and environmental conditions; the dispersed pattern of settlement and the small scale of industrial enterprises being traditional features which are highly valued in Norway. As a result of these apprehensions, the Norwegian Directorate of Labour undertook in Autumn 1974 a recruitment survey (Arbeidsdirektoratet, 1975). The survey examined, for some 3300 workers in the oil industry in 1974, their workplace kommune, kommune of residence, commuting, industry and occupation, both for 1974 and two years earlier. Six ~~~~??~~~e~ were studied (Figure 1) and only new activities were included, that is to in, for example, supply say, employment ship building was excluded since it is, for the most part, carried out in previously existing 201
Geoforum/Volume
202
Fylke boundaries and code numbers Concrete
platform
berth
Mobile
rug constructIon
Servlce
base
Steel jacket/ deck construction Refinery
0
100
m/h3
/
1 I
I
0
k/n
Figure l
100
1
Locations and types of oil activities included in the Recruitment Survey. (Note: Figures 2-4 show fylke boundaries, as defined here, rather than the Norwegian coastline). Source:
ARBEIDSDIREKTORATET.
1975.
8/Number
4/ 1977
Geoforum/Volume
8/Number-4/1977
shipyards’ . In order to ensure a good response rate and rapid results, the questionnaire was kept short and simple and, although they are undoubtedly important to an analysis of labour mobility, no questions on motives or earnings were asked. An overall response rate of 77 per cent was achieved, although this varied considerably according to the type of activity involved. The purpose of this paper is to describe the geographical and industrial patterns of recruitment to the oil industry which emerge from the recruitment in order to expose the problems survey, related to the introduction of large scale industry into areas which have not previously experienced a rapid rate and large scale of industrial development. The implications for manpower policy are then set out. The discussion centres upon the main results of the analysis at the national level since a detailed analysis of the catchment areas of individual sites and industry types would be beyond the scope of this paper. The Geographical Pattern of Recruitment The starting point for an analysis of recruitment is the geographical pattern of places of residence of the oil workers in 1972. This pattern, compared with that in 1974, is very dispersed, the 1974 pattern being one of concentration in Vestlandet and Trbndelag (Figures 2 and 3 and Tables 1 and 2). By comparing these two sets of data, labour migrations as a direct result of the oil activities can be detected. The degree of labour mobility in a labour force responds to the level of opportunity in employment alternatives. It represents the necessary adaptability in a labour force which is needed to meet changes in employment demand in a labour market, an industry, or an individual plant (PALMER, 1954). By encouraging labour to move to appropriate occupations, industries or localities and away from less productive or declining ones, a more productive and efficient utilisation of manpower resources is achieved (HUNTER and REID, 1970). Thus job selection on the part of the employee is a function of a careful appraisal of alternative employment oppor1. The total level in August 1974 was 5960 were employed (Arbeidsdirektoratet,
of oil employment in Norway 16,101 of which approximately in previously existing shipyards 1974).
tunities. Where there are comparatively few possibilities, “A low density of employment opportunities” (BOGUE, 1952), the job seeker may quickly exhaust the range of openings without finding a suitable position. Under such circumstances, migration, or the choice of long distance commuting in order to secure employment may be the result. Areas with limited job prospects are thus more likely to be “sending” areas when a major growth industry, such as the offshore oil industry, is established. The Pattern of Residence
in 1972 and 1974
The pattern of places of residence, both in 1972 and 1974, of the 3292 workers in the oil industry in 1974 is very dispersed. The areas in closest proximity to the main centres of oil activity (Stavanger/Sola, Fjell, Lindss, Rauma and Verdal) had the greatest proportion of oil workers resident at both points in time and have increased their proportion in 1974. Rogaland, with nearly 25 per cent of the workers in 1972, had 28 per cent in 1974 and Nord Trdndelag, with 16 per cent in 1972, had increased its proportion to 23 per cent in 1974 as a result of the Aker Verdal yard at Verdalsbra. Regions declining in their importance as places of residence are those which are farthest from the main centres of oil activity. One such example is Qstlandet, which had 14 per cent of the oil workers resident in 1972, but had decreased its proportion to 8.5 per cent in 1974. Similarly, Nord Norge had 3.25 per cent of the surveyed workers in 1972, but only 1 per cent in 1974. These figures are further disaggregated into rural and urban kommuner2 which contributes further to an explanation of the changes involved. An increase from 59 to 68 per cent of workers in residence in rural kommuner is explained by the fact that the oil activities are, by and large, located in rural areas (except for Stavanger/Sola). For example, Verdal had 505 oil workers in residence in 1974, compared with only 241 in 1972. The greatest
diversity
of skills is to be found
2. “Urban” Kommuner, for the purposes of this paper, are those with 5000 or more inhabitants in urban settlements and where this figure constitutes 65 per cent or more of the total population of the
kommune.
204
~eof~rurn~volurn~
/
8/Number
-. se_,_’ u
Number of employees /_~::::::::::::gg
I
4/1977
Geoforum/Volume
8/Number
Svalbard
Resident
Locatlon
205
4/1977
0
abroad
NONE
not given
0
/
If 0
0
0
0
Number
of employees
Figure 3 Residential Source:
locations
as Figure
1.
of oil workers
in 1974.
206
in
Geoforum/Volume
large
metropolitan labour markets, 1954) and the results of the recruitment survey comply with this finding in that large urban centres have provided a large proportion of the labour employed in the oil industry in 1974. Oslo, Bergen and Trondheim together contributed 33 7 workers to the oil industry, of which 192 were still living in these centres in 1974. (1972 = 76, 154 and 104 respectively and 1974 = 22, 1 13 and 57 respectively). Shipbuilding centres, for example Moss, as well as those kwnmurwr with an already established petrochemicals industry, for example Porsgrunn, also played a significant role as supplying centres for labour for the oil industry. (PALMER,
8/Number
In Nord Norge, the greatest proportional loss had been from rural kommuner: 67 workers were living in rural areas in the region in 1972 as compared with 22 in 1974. (40 and 15 in urban kommuner in 1972 and 1974 respectively). This is a reflection of two factors. Firstly, the lack of adequate job opportunities in the region and hence the decision to migrate once a suitable opportunity elsewhere arises. However, as Nicholson (1975) points out, the registration of a migration is not unusual in the case of unmarried workers obtaining employment outside the kommunc, even though the long term intention may be to return and settle down in the kotnrnme of origin. On the other
Table 1 l
Fylke of residence 1972 Fylke/Region
Total
Percentage
Abroad 01 @tfold 02 Akershus 03 Oslo 04 Hedmark 05 Oppland 06 Buskerud 07 Vestfold 08 Telemark
50 57 51 76 22 144 27 29 41
1.52 1.72 1.55 2.31 0.67 4.38 0.82 0.88 1.25
447
13.58
24 58
0.73 1.77
82
2.5
ostlandet 09 Aust Agder 10 Vest Agder SQrlandet 11 12 14 15
Rogaland Hordaland Sogn og Fjordane M&e og Romsdal
Vestlandet 16 Sdr Trdndelag 17 Nord Trbndelag Trandelag 18 Nordland 19 Troms 20 Finnmark Nord Norge Svalbard Not given Total
812 507 101 429
24.67 15.4 3.07 13.04
1849
56.2
191 514
5.81 15.62
705
2 1.4
67 32 8
2.04 0.98 0.25
107
3.25
I 51
0.03 I .55
3292
4/ 1977
100.0
Kommune Urban
type Rural
55 44 76 1;?
? ? 0 132 30
8 22 35
19 7 6
3 28
21 30
556 187 5 45
256 320 96 384
117 11
74 503
26 14 0
41 18 8
1246
1944
Geoforum/Volume
8/Number
2-07
4/1977
Table 2 l
Fylke of residence 1974
FylkelRegion
Total
Abroad 01 Qstfold 02 Akershus 03 Oslo 04 Hedmark 05 Oppland 06 Buskerud 07 Vestfold 08 Telemark
5 26 21 22 14 140 14 17 27
0.16 0.79 0.64 0.67 0.43 4.26 0.43 0.52 0.82
281
8.5
Q)stlandet 09 Aust Agder 10 Vest Agder Sbrlandet 11 12 14 15
Rogaland Hordaland Sogn og Fjordane Mdre og Romsdal
Vestlandet 16 SQr Trdndelag 17 Nord Trbndelag Trdndelag 18 Nordland 19 Troms 20 Finnmark Nord Norge Svalbard Not given Total
20 52
0.61 1.58
72
2.18
922 585 72 448
28.01 17.77 2.19 13.61
2027
61.57
112 752
3.41 22.85
864
26.24
21 15 1
0.64 0.46 0.03
37
1.12
0 6
E.19
3292
hand, married workers, leaving their families behind, are less likely to be recorded as emigrants. Secondly, the volume of migrations from the north reflects the difficulty of commuting (on a weekly or fortnightly basis) over very long distances. Many companies provide a travel subsidy for their employees, but the costs of travelling to and from Nord Norge will, in most cases, exceed the travel allowance offered. The relationship between the degree of permanency of the various types of oil employment and the level of migration is discussed in a later section which deals with the analysis of mobility according to industrial classifications.
Kommune Urban
Percentage
-
100.0
Migrations
type Rural
23 17 22 1 11 4 11 19
3 4 0 13 129 10
1 30
19 22
643 135 322
279 450 70 416
65 0
47 752
7 8 0
14 7 1
_ _
-
1031
2250
as a Result
:
of the Oil Activities
Table 3 and Figure 4 show the pattern of migrations that have resulted from the establishment of the offshore oil industry and associated activities in the Vestlandet and Trbndelag regions of Norway. A large number of these migrations may be explained by distance in the sense that daily, weekly or fortnightly commuting is impractical. The greatest migration losses are found in those regions far removed from the centres of oil activity; a net loss of 169 workers was recorded for @stlandet and a loss of 62 oil workers from Nord Norge. In Vestlandet
there
has been
a net gain of
208
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Table 3 l
Migrations of oil workers 1977-4
~,llkc/Rcgiorl
Abroad * 0 1 qsti-old 02 Akersbus 03 Oslo 04 Hedmark 05 Oppland 06 Buskcrud 07 Vcstfold 08 Telemark (0stlandct 09 Aust Agder IO Vest Agdet Sdrlandet
Total 5 1 0 0
I6 Sdr Trbndelag 17 Nord Trondelag Trbndelag 18 Nordland I9 Trams 30 Finnmark Nord Norge Svalbard
Total
3 0 0 0 : 0 I
0 1
0 3
4 10 14
4 X8 0 0 0
‘8
147 5 64
331 0 286
Rural
“6 __
12 0 4
Urban _ ’
4s 36 33 54 x 7 13 13 17
,
0 I 3
I 1 Rogaland 116 13 Hordaland 147 14 Sogn og Fjordane 5 15 M$re og 64 Romsdal Vestlandet
Urban
6 71 36 47
5 I9
33 34
160 0 0
0 286
73 54
27 45
28 11 6
286 1 0 0
0 0 0
39 17 7
I
0
63
0
I
.. not applicable * This indicates that 45 workers who were living abroad in 1972 bad moved to Norway by 1974.
175 oil workers, that is a gain of 332 partly balanced by a loss of 157. The greatest number of migration gains were recorded for those rural kommrtner which either had oil activity or were adjacent to kommurzw with for example, Lindgs, oil activity, Austrheim, and Rauma. However, the relatively large number of 96 migrations from rural ~W?ZUZU/WFwithout close association with the oil industry were recorded. In Trbndelag. 72. out migrations from rural
konzunL!rzer may be compared with only 55 from urban kon7r721~17c1., of which 4 1 came from Trondheim, the main urban centre in the region. One notable feature is the relatively small scale of migration to the Stavanger/Sola arca. Although there were 6 13 oil workers resident in the two li~~z~?zl~~er in 1974. this represents a gain by migration of only 89 people. This limited population effect can be explained
Geoforum/Volume
8/Number
Svalbard
4/1977
209
0
Resident abroad
Location
not gwen
Number
of employees .,
0
Figure 4
Labour
migrations
1972-74
Soutw: as Figure 1.
as a result of oil activities
km
100
Geoforum/Volume
by two factors3. Firstly, 10.7 per cent of the oil workers in the survey registered the North Sea as their place of work in 1974. This category of employment, based predominantly in the Stavanger region, entails a two week shift and thus permits a virtually unrestricted place of residence. Secondly. a large metropolitan labour market, such as the Stavanger region, can be expected to contain a large diversity of skills and thus can, to a great extent, supply its own needs internally without having to resort to tapping other labour markets for the required labour. Together, these two factors explain the apparently low impact of the oil industry on in-migration experienced in Stavanger and Sola komnuner. The converse is true for rural areas such as Verdal where a net gain of 261 workers is recorded during the period 1972 to 1974. A small labour market. comprising a limited pool of labour, cannot be expected to be able to provide all the labour requirements when a large new establishment enters the region and hence must expect to be forced to import the greater bulk of its workforce from other areas. Of the 505 workers living in Verdal lio~~~?nlrtz~, nearly 5 2 per cent of them were in-migrants. By contrast Rauma konzrt~tlne, another rural area, has had a level of in-migration which is unusually low; only 28 per cent of the recruits to the Norwegian Contractors yard at Andalsnes were in-migrants. This low level of in-migration may be explained by two factors. Firstly, the yard was, from its inccption, regarded as a short-term construction site, a factor which would deter workers from moving into the region permanently. Secondly, on the completion of the Grytten power plant in 197 1, there was severe unemployment in the liO~?Z??7ZltlC~, which meant that many of the oil construction workers were recruited locally. In fact, it was the uncmployment level in the k01171112111e which had been a spur to the establishment of the platform construction site originally. The problem of unemployment in Rauma kommum~ has, however, only been postjloned. On the completion of the Condeep 3. Vesterhus (,I9741 suggests a third factor, that of internal production adaptation within existing firms. This feature is common in the building of supply ships. but was excluded from the Directorate’s survey.
8/Number
4/1977
platform for the Frigg field in June 1977, the yard had no further work and operations there have since been closed down. In general it is the rural areas far removed from the centres of oil activity which are sending workers to the oil industry. However, a simple rural/urban classification is an inadequate means of furthering this avenue of investigation of oil related migrations. Migration gains and losses are now grouj,ed according to the classification of h-ommutwt drawn up by the Norwegian Institute of Urban and Regional Research (NIBR, 1976) using 1970 Census material. The NIBR classification provides a more detailed picture of the migration of oil workers and is used below to elaborate the migration patterns. With the establishment of the offshore oil industry in Norway came the general fear that, given the very tight labour market during the period 1971 74. the increase in oil related employment would of necessity come from existing industry. It was assumed that it would be the declining primary industries, as well as some low wage secondary and tertiary industries, which would be tapped. (See, for example, STAHL-JOHANNSSEN, 1973: OLSEN, 1975 and STENSTADVOL~~. 1977). The analysis of the recruitment s~lrvey by the Directorate of Labour showed that the industrial transfers from primary industries were less serious than had been feared: only 4 per cent of those in the oil industry in 1974 had come from agriculture and fisheries. As Torgersen( 1975) points out”these main results must be seen to be particularly reassuring for those who had feared extensive poaching of the primary workforce”. While this may indeed be the case great care must be exercised in interpreting the longer-term consequences. for although it may not be the primary industries themselves which are losing employment to the oil industry, nevertheless, it is those areas which have a strong dependency on primary activities that are the main “sending” areas. It is consistently found that the greater number of emigrants from rural areas have their occupations in secondary and tertiary sectors rather than in the primaly sector. (NlcIjOLSON, 1975). Nevertheless, an emigration from a primary area serves to undermine the local economic base. depriving the 1\0/)7/>71//1<’ of its workforce in a valuable
Geoforum/Volume
8/Number
4/1977
sector of activity. Such migrations may, in fact, be more harmful to the community than a migration from the primary sector. Underemployment is a common feature in primary industries, so that an employee can be lost without any effect on productivity. The same may not be true for secondary and tertiary employment. The probability that the emigration of a secondary or tertiary worker sets off a chain reaction of sectoral transfers from primary activities in order to fill a vacancy is perhaps greater in areas which have a higher proportion of their workforce in the primary sector. This theme of structural changes in employment will be taken up later in the section on industrial mobility. Of the 3292 oil workers interviewed, 636, approximately 20 per cent, changed their place of residence between 1972 and 1974. Table 4 gives a breakdown of these residence changes by k~?nrnt~n~ type using the NIBR classification.
It is emphasised that this picture does not imply that primary industries themselves are losing employees to the oil industry. The table does, however, show the types of kommuner that are “sending” areas; the strong emergence of agricultural and fishery k~rnrnz~~er is noted. Also of interest is the fact that “Stagnating manufacturing kommuner” also make a significant contribution to the pattern of out migrations. It could be suggested that the explanation of this pattern lies in the distance factor, that is that the location of the oil activities, in particular at Wndalsnes and Verdalsqira, are in the regions where primary kommuner comprise a large proportion of the total number of kommurzer. Indeed, it has been found that 19 per cent of the migrations from primary k~mmu~zer came from within 50 km of the oil centres. However, these losses from kommuner adjacent to the oil centres do not necessarily represent a migration to the nearest oil centre; in some cases they are migrations to more distant centres of oil employment.
Tabie 4 l
Migrations of oil workers by
kommune type Gains ofwhich 16 2
Losses 105 24 and service kommuner 21
Kommune [vpe One sided agricultural kommuner Fishery kommuner i Stagnating manufacturing I
Mixed agricultural
and m~ufactu~ng
t Regional centre kommuner ( Suburban
kommuner
\ Large urban kon~muner Abroad Svalbard Not given Total
The kummu~ze~ with gains in population are of less interest from this point of view as the distribution is a function of the classifications of those kommuner which have oil activities within their bounda~es. Only the figures for migration losses are discussed here. These are weighted according to the proportion of national population in each class and the weighted values are given in Table 5.
kommuner
1
65 59
45
34
226
89
= 62 = 261 = 20
Sola Stavanger = 58 Sandnes = 28
45 4: 545+91
636
The weighted values for out migrations show that over 36 per cent of the out migrations came from primary kommuner (“one sided and “fishery” agricultural” kommuner), whereas only 16 per cent of the national population is to be found in these areas. It can thus be argued that the impact of the oil industry on the primary sector is greater than was at first supposed. A similar conclu-
212
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Table 5 l
Weighted migration
Kommutw
losses by kommune
type
Weigh ted Percentage of Migration loss National Population
type
One sided agricultural kotnmuner Fishery kommuner Stagnating manufacturing and service kommuncr Mixed agricultural and manufacturing kommutzer Regional ccntre kommutzcr Suburban kommuner Large urban kommutw
” 0 14.25 16.25 10.1-S 15.75 7.75 13.75
_u.
100
Total
Oil Workers
Industrial origins of the oil workforce and the industrial distribution of the economically active population in Norway in 1972. (Percentages)
Not in employment in 1972. including Agriculture, forestry Fisheries Mining, manufacturing Building and Construction Trade, hotels and restaurants Sea transport Other transport and communications Other . Not given
sion is reached for the impact on industrial mobility disucssed in the next section.
The Industrial
4.19 3.24 15.80 9.37 14.64 40.90 100
Table 6 l
11.88
Patkrrz
ojfRemritmen
t
The second major cause for concern after the establishment of the offshore oil industry
in Norway was that the creation of a new form of industrial activity in a country with a tight labour market might cause too rapid structural changes in employment. In Norway, as in other industrialised countries, there has been a shift away from dispersed forms of economic activity towards industries more compactly located; this in the main represents a shift from rural occupations to urban activities. The economy may be divided into two sectors, one sheltered, the other exposed. The first comprises industries producing for the domestic market which have negligible foreign competition. These include some service industries and building and construction. The second group consists of those industries that produce goods for export and for domestic consumption and which face strong competition from overseas; examples are the textiles and furniture indus-
unemployed
19.4 3.1 I .o 24.4 28.8 5.6 5.5 3.3 7.4 1.5
Norway
10.6 1.5 25.4 8.7 16.0 9.8 27.7
tries. It is these industries which are finding it extremely difficult to survive and which might be expected to be main suppliers of labour to the oil industry. In addition it was felt that the oil industry might accelerate the shift away from the primary industries which are also shedding labour. Table 6 shows the industrial distribution of the oil workers in 1972 compared with that of the economically active population in Norway as a whole for the same year. As a result of the strong bias of the survey towards construction and installation work, it is not surprising that mining, manufacturing, building and construction are strongly represented as industrial origins of the oil workforce; together, these sectors comprise 53 per cent of the total. The nature of the industrial classification (SIC orders) surveyed (see Table 7) largely explains the industrial pattern of recruitment. In fact, most of those workers in the survey did not change industries at all. This is a function of the fineness of the industrial
Geoforum/Volume 8/Number 4/ 1977
classification used. Since the classification for industry in 1972 used in the survey was very broad, it precludes any detailed analysis of inter-industry transfers. Table 7 l
Industrial grouping for recruitment survey (percentages)
Extraction and Production of oil and gas Refineries Platform Construction Construction Catering Transport and Storage Engineering, architectural and technical services Cleaning services
8.1 6.4 57.0 10.8 2.8 14.1 0.3 0.2
Structural changes in employment are mainly effected by means of movements into and out of the labour market (PALMER, 1954). Thus expanding industries have, as their main source of recruits, young persons entering the labour force for the first time. Conversely, as older workers leave contracting industries, (they may be encouraged to retire early), they are not replaced and a rundown in employment is achieved. In other words, transfers of employees between industries are not the main way in which structural changes in employment are brought about. However, if expansion occurs rapidly, as in the case of the offshore oil industry, then it is inevitable that transfers from other industries will take place; in the same way the rapid run down of a plant will lead to redundancies. In the case of the oil industry some 19.4 per cent of recruits were not previously in employment, the low figure reflecting the idea that the oil industry, for the most part, requires skilled workers with some industrial experience. Patterns of industrial recruitment are largely set by occupational factors (MACKAY et al., 1972). Thus. those involved in catering, transport and construction in 1972 are most likely to move into these areas of the oil industry. For service base operations the recruitment level from sea transport is high (17.0 per cent) see Table 8.
One group of activities which have no apparent occupational link with the oil industry is the primary sector, that is agriculture,
forestry and tishing.4 Together this group comprised 4.1 per cent of what was to be the oil workforce in 1974, compared with some 12 per cent of the total workforce for the country as a whole. These results must, however, be taken with some caution. One shortcoming of the survey is the fact that it records only one step in the reallocation ladder. For example Salt (1967) has shown that in the case of the Ford and Vauxhall plants in the United Kingdom, which were located in Merseyside in order to help the unemployment situation, only 8.7 per cent of the recruits came from the ranks of the unemployed. However if the balance of workers came from other industries, then in theory, a number of vacancies are created in those industries. So although at first glance, the new plants appear to have done little to ease unemployment in the area, it is necessary to consider the “rippling effect” (GRIME and STARKIE, 1968) or the chains of job changes which such a plant might set in motion. Although the Recruitment Survey cannot itself indicate these chains of linkage which an occupational life history survey would be able to do (see, for example, RAM SOY, 1975) some work in this connection has been carried out. HUNTER and REID (1970) quote a French study which has shown strong movements of workers from agriculture to building and construction. After a period of time giving some industrial experience, these workers are able to move on to better jobs in manufacturing. In other words, building and construction acts as an intermediary occupation for transfers from primary to manufacturing activities. In Norway, the Building Research Institute (NBI) has compiled information on recruitment patterns to building and construction (HEGNA, 1974). The study showed that 20 per cent of recruits to the industry who had had previous employment came from the primary industries and the figure was even higher for commuters (32 per cent). This latter feature suggests that former primary workers usually wish to maintain their contact with primary activities and so do not tend to move to their work site permanently, but rather prefer to commute. Given the 4. In Norway, industry.
mining is classified as a secondary
Geoforum/Volume
214
uncertain nature of construction work, it is not surprising that the worker is reluctant to give up the holding which once provided him with his livelihood. The survey showed that it was the large cities which were most important as workplaces, but were of little importance as recruitment or residence places.
8/Number
4/ 1977
construction sector. The impact of the oil related activities is thus much greater than is at first imagined. An analysis of the recruitment patterns of other forms of economic activity which are expanding, or at least maintaining, their current levels of employment and are at the same time sending some
Table 8 l
Industrial
Industry
origins of oil workforce by workplace in 1974. (percentages)
1972
Agricultural and Forestry Fishing Mining and Manufacturing Building and Construction Trade, Hotels and Restaurants Sea Transport Other transport and communications Other Not given
Stavanger 2.5 0.2 13.3 45.2 5.5 2.7 4.4 6.5 3.4
For rural kornmuner, the converse was true. In connection with the oil industry it should be noted that a large part of the construction activity is located in rural areas, thus enabling a reduction in the traditional separation between workplace and residence for construction workers. These findings have some utility as regards the oil Recruitment Survey. Figure 5 shows the possible backward linkages for recruitment to the oil industry, based on the findings of the Recruitment Survey itself and the NBI report by Hegna. Of the 2245 workers in oil related construction in 1974. 647 (28.8 per cent) had come from other types of construction activity. By using the Hegna report, it is possible to say that if construction activity was to be maintained at the same scale, then the same number of vacancies would exist in the construction industry and this in turn would set in motion flows from other industrial groups. These flows would follow the pattern suggested by Hegna. Some 20 per cent would come from primary activities, so that for the 2245 construction jobs created in the oil industry, some 221 primary jobs would be lost. That is to say, 92 would move directly from the primary sector to oil related construction and another 129 would move from primary activities into the vacated construction jobs in the general
Sola 0.4 0.4 30.2 5.6 10.9 5.2 4.4 16.5 0.8
Fjell 2.8 0 47.2 13.9 5.6 11.1 0 5.6 0
Lind”as
Rauma
Verdal
North Sea
2.0 0 20.1 33.9 5.0 6.9 1.3 9.1 3.3
4.9 1.7 14.7 46.7 3.5 2.1 2.5 2.8 1.2
4.4 0.7 44.1 12.8 5.4 4.2 I .9 3.2 0
1.1 2.0 31.8 7.9 7.6 17.0 9.9 17.6 0.3
of their workers to the oil industry, may reveal further indications that primary industries are being tapped as a source of labour to the oil industry on a scale more extensive than that suggested by the Recruitment Survey. The backward linkages suggested by this analysis of construction workers leads to the conclusion that chains of job changes may be initiated by the expansion of a single industry. This inputGoutput effect is not confined to the primary sector and may be equally as strong for other industries, and it is an area which must receive further attention in the future debate about the impact of North Sea oil on structural changes in employment. The NBI study also indicated that the characteristics of the area in which the new activity is located influence the industrial pattern of recruitment. Projects located in rural areas have a greater proportion of recruits from primary activities than do those located in more urbanised areas. This is because labour tends to be recruited locally, as far as possible, and thus in a rural area the greatest probability of transfer is from a rural occupation. Table 8 shows that this is a feature confirmed in the Recruitment Survey. Rauma
and Verdal
recruited
4.9 and 4.4 per
Geoforum/Volume
8/Number
215
4/1977 Not
in employment
entrantsto
1
(new labour
the
OIL and
force,
or
I-
unemployed)
RELATED
Restaurants
Figure 5 l
Patterns of recruitment
to oil related construction
Source: HEGNA, 1974. ARBEIDSDIREKTORATET. respectively from agriculture and fores try, compared with only 2.5 and 0.4 per cent for the more urbanised I?OI?I~Z~IHCY of Stavanger and Sola. Origins in secondary activities are largely explained by the nature of the oil activity in each hnmtrne. Building and construction are strong origins for those engaged in platform construction at Rauma and mining and manufacturing emerge as important sources of labour for those employed at Aker Verdal. Although this latter yard is classified as a platform construction site, the work is the construction of steel jackets and decks and therefore requires welding skills which are characteristic of rather than construction manufacturing activity.5 cent
The main conclusion from this analysis of labour mobility resulting from the establishment of the oil industry in Norway is that the impact on primary employment may be greater than was at first apparent from an 5. This confusion arises from the fact that the oil activities were classified in the Recruitment Survey using the ISIC. ISIC order 3824 “manufacture of comprises not only concrete industrial machinery” but also steel platform construction; a five-digit classification would not ease the problem since order 38241 is “manufacture of oil and gas well machinery and tools”. Steel and concrete platform construction have totally different skill requirements, thus some thought needs to be given to a precise definition of the “oil industry” and its components.
and to building and construction.
1975.
initial study of the recruitment patterns. This is for two reasons. Firstly, this analysis has shown that the primary h-omm~ner (those classified under the NIBR classification “one sided agricultural” and “fishery” %nlrnunc~) have been the greatest losers of population from migrations resulting from the oil activities. Secondly, the rippling effect of new industries means that chains of job changes result from the increased manpower requirements of a single plant since the rapid expansion of a plant means that the labour needs cannot be met solely from the natural increase in the economically active population. Recruitment patterns are coloured not only by occupational factors, but also by the characteristics of the location in which the new industry is sited. Close occupational linkages between two industries ensures a strong recruitment link when one is expanding. Large urban labour markets can generally supply their own needs for labour whereas rural areas must expect to import a large proportion of the required workforce. Finally, the permanency of employment influences the decision to migrate. Workplaces perceived as being temporary are unlikely to encourage labour to migrate if there is the possibility that there will be a shutdown within a short period, as in the case of hdalsnes, which had had an operation time of three and a half years when it closed in
216
Geoforum/Volume
the summer of 1977. These features of the oil industry must serve as a basis for the formulation of an active manpower policy.
OiE and Manpower Policy The traditional view of Iabour nlobility is that it is important to the proper functioning of the labour market as it brings about a more efficient redistribution of labour by channelling workers into expanding industries and away from contracting ones, so increasing productivity. Thus an active manpower policy has as a key objective the encouragement of these transfers. With the tradition of underemployment in some forms of economic activity, such as agriculture, and the slow decline of certain manufacturing sectors together with the rapidly expanding employment needs of the oil industry (at least in its early stages of development), a policy of encouragement of mobility is possible for the Norwegian oil situation. However, in Norway, as noted above, the dispersed pattern of settlement and the small scale of industrial enterprises are traditional features which are highly valued, and there is considerable interest in maintaining the present pattern. ‘171~s manpower policy tends to be socially oriented rather than efficiency conscious. In addition, the oil industry is a particularly uncertain form of activity. In recent months it has become apparent that some sectors of the industry will not continue to expand at the previous rate and some, notably platform construction, will even decline. Another characteristic of the oil industry, and in particular the construction sector, is that employment levels fluctuate considerably over time. A large number of workers may be taken on for a period of 3 to 6 months in order to complete a platform on schedule for float-out during the spring/summer “weather window”. The same workers may then be made redundant. A single manpower policy for the oil industry would thus be ~lnsatisfacto~ given its very diverse nature. It may be useful to classify the oil related activities on the basis of their permanency in order to determine suitable manpower policies. Three
types
of oil related
activities
may be
8/Number
4/ 1977
distinguished and different policies encouraged for each. Firstly, employment opportunities in, for example, refineries and service bases, may be regarded as permanent, assuming a long-term depletion policy for the North Sea. It may, therefore, be acceptable to encourage workers to move into such activities and to migrate to the regions in which these activities arc located. For semi-permanent oil jobs, such as the construction and repair of steel rings and platforms, much of the work may be utldertakell in previously existing shipyards where the main labour force is already prosent. Extra labour may be brought in when contract commitments demand a speedy completion of the order. Workers already in the same industry, but in other locations, may perhaps be helped to move on a temporary basis so as to help to complete the contract. The Aker Group in Norway has the greater share of this type of activity and, having shipyards scattered throughout the country, has the possibility to transfer its employees to the locations in which they are required. The increased labour requirements at Akcr’s yard at Stord, in March 1977, and the surplus of labour at Aker Verdal, meant that Verdal workers could be given priority for jobs at Stord if they were willing to move. Thirdly, building and construction are forms of cmploymen t which are traditionally teniporary and which require a rather different manpower policy. Examples of construction activity in the oil industry are concrctc ~~latfo~ co~~str~lctiol~ and the corlstl-~ictio~l of oil refineries and plant for other “‘downactivities. In the case of plant for stream” such downstream activities. the project could be phased so that a small scale of activity could take place over an extended period of time. For platform c(~nstrLlctio~l. the sc‘paration of the different functions of each platform co~tld enable orders to be distributed amongst several yards, rather than the construction of a giant multifunctional platform. such as Statfjord A. at a single yard. A separate ~~ccoI~~l~~odatio~iplatform is, for safety reasons, being demanded by the Norwegian Pctrolcum Directorate for Statfjord B, and the orders for the production system are cxpcctcd to be placed by the end of this year. This could enable the orders to bc placed at several yards throughout the counlarge scale c~~li~~~lti-~~tc~l try so replacing
~;~oforum/Volume
8/Number
411977
and its resultant problems with small scale dispersed activity. The latter fitting more naturally with the traditional pattern of economic activity in Norway.
employment
Dependence on temporary employment is an unsatisfactory state for a local economy. The completion of the Grytten power plant in Rauma in 1971 left a pool of unemploynlent which has partially been taken up by the establishment of Norwegian Contractors at Andalsnes. This has subsequently proved another temporary project since the lack of orders for offshore structures has hit Norwegian, as well as British, platform construction sites. From Norway’s point of view it might be more satisfactory to have Norwegian designed offshore structures built abroad under licence. However, projects involving job creation, regardless of how temporary, will often be given a favourable reception from local authorities. Even if the problems of temporary construction employment are recognised, the deep water fjords of Norway may be the only suitable locations for the construction of some platforms. In this case, one solution might be to bring in foreign workers, or long-distance commuters, rather than allow the local workforce to participate in the project. This would enable the unemployment problem to be dispersed once the project had been completed. Such a policy was attempted by Zetland County Council for the Sullom Voe terminal in the Shetlands, but pressures from the local workforce for involvement soon eroded the Council’s policy, and locals were eventually employed on the project. In terms of the industrial redistribution of labour, the permanency of employment is also of inlportance. Having once moved from one industry to a newly established industry, the chances of returning to the original industry are small. Either the sending firm has been unable to continue as a result of loss of labour and an inability to replace the workers who have left (perhaps as a result of unattractive wage levels or working conditions) or the vacancies have been filled. In either case there is seldom an opening for the returning worker. Conclusion
The Recruitment Survey has been an attempt to assess the impact on employment of North
Sea oil in Norway, in particular by examining the geographical and industrial patterns of recruitment to the oil industry. This paper has shown that there has been a movement towards Vestlandet and Trbndelag and considerable migration losses from primary industry kommurwr. In terms of industrial transfers, the initial fear for a loss from primary activities is apparently unfounded. The caution about rippling effects is, however, expressed since the total effect on industrial transfers of the establishment of a new industry is not necessarily apparent from an analysis of one step in the scheme of interindustry movements. The nature and characteristics of the oil activities should be fully understood before any active manpower policy can be applied. Transfers effected as a result of initial “Klondike fever” may, in a relatively short period, turn out to be bad decisions which prove detrimental to economic growth. The traditional view that mobility in the labour market is a healthy sign which suggests an efficient functioning of the economy may thus be misguided.
~ck~~~~~~gern~~~~ - This paper forms part of the author’s Ph.D. research which was undertaken with the aid of support from the Social Science Research Council and the Dudley Stamp Memorial Fund. The author would like to thank Mr. D. J. Sinclair, Mr. D. R. Diamond and Kjell Stenstadvold who read and gave helpful comments on the first draft of this paper. Thanks are also due to Janet Baker who, with great care and patience, drew the maps. References
ARBEIDSDIREKTORATET ved oljeaktivitetene, direktoratet, Oslo,
(1974) SysseZsertingen
August,
19 74.
Arbeids-
(1975) Rekrutteringsunderqbkelsen H&ten 1974. Arbeidsdirektoratet, Oslo. A ~et~~olo~cal Study of BOGUE D. J. (1952) M&ration and Labour Mobility. Scripps Foundation Studies in Population Distribution. No. 4. GRIME E. K. & STARKIE D. N. M. (1968) New jobs for old: An impact study of a new factory in Furness. Reg. Studies 2, pp 57-67. HEGNA T. J. (1974) Arbeidskraf?unders~kelsen i Norges bygge og an~eggsbransjen I 9 73/4. Byggforskningsinstitutt, Oslo. Arb. Rapp. 74/O3661. ARBEIDSDIREKTORATET
118
HOPE E. (1975) N~erings~koiliskc Konsekvenser in Norsk Oljepolirikk. WYLLER K. B. & T. C. Gyldendal Norsk Forlag. HUNTER L. & REID G. (1970) Urban Worker Mobility. O.E.C.D. 2 I5 pp. MACKA:’ D. I. ct al. (1972) Labour Markers Under Differed t Ernp~oy~~e~r ~~~~l~~~~~~~s, Allen & Unwin, 433 pp. NIBR ( 1976) Erfaringer fra Gerwralplanarbcidet. Norsk Institutt for By-og Regionforskning, Oslo. NICHOLSON B. (1975) Return Migration to a an example from Northern Marginal Rural Area Norway. Sociulugia Ruraiis. 15, 227-44. NORDI~US 0. (1976) Norway as an Oil Nation. Norges Bank Economic Bullefin. XLVII (3), pp 150-160. OLSEN R. (1975) Oljens konsekvenser for norsk naeringsliv. Norges Zndustri 57, pp 24&?7. PALMER G. (1954) Interpreting Patterns of Labour Mobility. in BAKKE E. W. (ed.) Lab~jt~r~~hi~i~~~ and ~c~~no~rtic Opp~~r~u~~ity.Wiley & M I .=r Press, 1 IS pp.
Geoforum/Volumc
8/Number
411977
RAMS@Y N. R. (1975) Oe~,l~p~~i~~~la~ Lijti Historic Study. Institute fur Applied Social Kcsearch. University of Oslo. (mimeo) SALT J. (1967) The impact of the Fol-d and Vauxhall plants on the employment situation in Merscyside, 1961 -65. T.V. E.S.G. LVIII(5). pp 255 64. STAHL-JOHANNESSEN, K. (1973) Oljen vil tappc annen industri for arbeidskraft. Norges Indusrri. 51 pp 6--8. STENSTADVOLD K. (I 977) Regional and Structural Effects of North Sea Oil in Norway. Mcddelclser fra Geografisk Institutt ved Norges Handclshoyskole og Universitetet i Bergen NI-. 37, 55pp. STORTINGS MELDING Nr. 15 (1973 74) Perrw Iezinll?irsonllretetIsplass i der twrskc snmfirmz. Finansdepsrtementet. Oslo. TORGERSEN L. (1975) Arbeidskrat’ten Cl1 Knapphetsfaktor? Plan og Arbeid Nr. 3, XX W. VESTERHUS T. (1974) F(vttinger .fLu og ri/ Salianger. Rogalands ~istriktsll~y~k(~le.
Vol. 8, pp. 201-218,
1977. Pergamon
Press. Printed
Patterns of Recruitment
of Geography, Houghton
Street,
London School
of L.ondon WCZA 2AE
England
A moderate rate of offshore activity is thus one of the main features of Norwegian oil policy. This is interpreted by the Government as a production ceiling of 90 million tonnes of oil equivalents per annum. However, technical problems, increasin~y stringent safety regulations and incidents, such as the Ekofisk Bravo blow-out in April 1977, have meant that an interim production peak has been naturally imposed and that the official production ceiling is now unlikely to be reached before 1987.
The oil and gas discoveries have introduced a new element into the Norwegian economy which represents new opportunities to the trade and industry sectors and new potential for the economic development of the country (NORDHUS, 1976). The oil related developments create problems, however, in the sense that they require resources which are already in use in other sectors of the economy, manpower being a particular example.
Economics, England.
in Norway
blessing. Rapid development could cause structural disiocation in the economy, together with environmental damage, and too rapid an injection of the revenues into the domestic economy will produce considerable inflationary pressures.
As a country with few natural resources, but with an extensive coastline, Norway has traditionally looked to the sea for its livelihood. Both the fishing grounds and the merchant marine have been major contributors to Norway’s wealth. The discoveries of oil and gas in the Norwegian sector of the Continental Shelf in the late 1960s and early 1970s have added yet another dimension to the importance of offshore areas to the economy of Norway.
* Department
Britain.
to the Oil Industry
SUSAN SQUIRES,*
Much of the debate surrounding the impact of North Sea oil has centred upon the indirect effects that the revenues, from taxes, royalties and direct state participation in production, will have on the economies of the various countries concerned (HOPE, 1975). In Norway, the promised revenue, which is expected to be in the order of US$20003000 millions per annum by 1981/2 (St. Meld. Nr. 25, 1973374) is seen as a means of assisting development in the country’s less prosperous regions. In addition it could permit the repayment of foreign debts and investments overseas and may also allow foreign aid contributions to be increased more easily. To date, no priorities over such policies have been established. Nevertheless, despite such obvious benefits, the oil related activities are seen very much as a mixed
in Great
In addition to the alarm expressed about the absorption of large revenues into the economy, fears have also been expressed that a rapid rate of growth in offshore activity could cause too rapid structural changes in the economy. This in turn could have unfavourable consequences for the pattern of population and economic activity as well as for social and environmental conditions; the dispersed pattern of settlement and the small scale of industrial enterprises being traditional features which are highly valued in Norway. As a result of these apprehensions, the Norwegian Directorate of Labour undertook in Autumn 1974 a recruitment survey (Arbeidsdirektoratet, 1975). The survey examined, for some 3300 workers in the oil industry in 1974, their workplace kommune, kommune of residence, commuting, industry and occupation, both for 1974 and two years earlier. Six ~~~~??~~~e~ were studied (Figure 1) and only new activities were included, that is to in, for example, supply say, employment ship building was excluded since it is, for the most part, carried out in previously existing 201
Geoforum/Volume
202
Fylke boundaries and code numbers Concrete
platform
berth
Mobile
rug constructIon
Servlce
base
Steel jacket/ deck construction Refinery
0
100
m/h3
/
1 I
I
0
k/n
Figure l
100
1
Locations and types of oil activities included in the Recruitment Survey. (Note: Figures 2-4 show fylke boundaries, as defined here, rather than the Norwegian coastline). Source:
ARBEIDSDIREKTORATET.
1975.
8/Number
4/ 1977
Geoforum/Volume
8/Number-4/1977
shipyards’ . In order to ensure a good response rate and rapid results, the questionnaire was kept short and simple and, although they are undoubtedly important to an analysis of labour mobility, no questions on motives or earnings were asked. An overall response rate of 77 per cent was achieved, although this varied considerably according to the type of activity involved. The purpose of this paper is to describe the geographical and industrial patterns of recruitment to the oil industry which emerge from the recruitment in order to expose the problems survey, related to the introduction of large scale industry into areas which have not previously experienced a rapid rate and large scale of industrial development. The implications for manpower policy are then set out. The discussion centres upon the main results of the analysis at the national level since a detailed analysis of the catchment areas of individual sites and industry types would be beyond the scope of this paper. The Geographical Pattern of Recruitment The starting point for an analysis of recruitment is the geographical pattern of places of residence of the oil workers in 1972. This pattern, compared with that in 1974, is very dispersed, the 1974 pattern being one of concentration in Vestlandet and Trbndelag (Figures 2 and 3 and Tables 1 and 2). By comparing these two sets of data, labour migrations as a direct result of the oil activities can be detected. The degree of labour mobility in a labour force responds to the level of opportunity in employment alternatives. It represents the necessary adaptability in a labour force which is needed to meet changes in employment demand in a labour market, an industry, or an individual plant (PALMER, 1954). By encouraging labour to move to appropriate occupations, industries or localities and away from less productive or declining ones, a more productive and efficient utilisation of manpower resources is achieved (HUNTER and REID, 1970). Thus job selection on the part of the employee is a function of a careful appraisal of alternative employment oppor1. The total level in August 1974 was 5960 were employed (Arbeidsdirektoratet,
of oil employment in Norway 16,101 of which approximately in previously existing shipyards 1974).
tunities. Where there are comparatively few possibilities, “A low density of employment opportunities” (BOGUE, 1952), the job seeker may quickly exhaust the range of openings without finding a suitable position. Under such circumstances, migration, or the choice of long distance commuting in order to secure employment may be the result. Areas with limited job prospects are thus more likely to be “sending” areas when a major growth industry, such as the offshore oil industry, is established. The Pattern of Residence
in 1972 and 1974
The pattern of places of residence, both in 1972 and 1974, of the 3292 workers in the oil industry in 1974 is very dispersed. The areas in closest proximity to the main centres of oil activity (Stavanger/Sola, Fjell, Lindss, Rauma and Verdal) had the greatest proportion of oil workers resident at both points in time and have increased their proportion in 1974. Rogaland, with nearly 25 per cent of the workers in 1972, had 28 per cent in 1974 and Nord Trdndelag, with 16 per cent in 1972, had increased its proportion to 23 per cent in 1974 as a result of the Aker Verdal yard at Verdalsbra. Regions declining in their importance as places of residence are those which are farthest from the main centres of oil activity. One such example is Qstlandet, which had 14 per cent of the oil workers resident in 1972, but had decreased its proportion to 8.5 per cent in 1974. Similarly, Nord Norge had 3.25 per cent of the surveyed workers in 1972, but only 1 per cent in 1974. These figures are further disaggregated into rural and urban kommuner2 which contributes further to an explanation of the changes involved. An increase from 59 to 68 per cent of workers in residence in rural kommuner is explained by the fact that the oil activities are, by and large, located in rural areas (except for Stavanger/Sola). For example, Verdal had 505 oil workers in residence in 1974, compared with only 241 in 1972. The greatest
diversity
of skills is to be found
2. “Urban” Kommuner, for the purposes of this paper, are those with 5000 or more inhabitants in urban settlements and where this figure constitutes 65 per cent or more of the total population of the
kommune.
204
~eof~rurn~volurn~
/
8/Number
-. se_,_’ u
Number of employees /_~::::::::::::gg
I
4/1977
Geoforum/Volume
8/Number
Svalbard
Resident
Locatlon
205
4/1977
0
abroad
NONE
not given
0
/
If 0
0
0
0
Number
of employees
Figure 3 Residential Source:
locations
as Figure
1.
of oil workers
in 1974.
206
in
Geoforum/Volume
large
metropolitan labour markets, 1954) and the results of the recruitment survey comply with this finding in that large urban centres have provided a large proportion of the labour employed in the oil industry in 1974. Oslo, Bergen and Trondheim together contributed 33 7 workers to the oil industry, of which 192 were still living in these centres in 1974. (1972 = 76, 154 and 104 respectively and 1974 = 22, 1 13 and 57 respectively). Shipbuilding centres, for example Moss, as well as those kwnmurwr with an already established petrochemicals industry, for example Porsgrunn, also played a significant role as supplying centres for labour for the oil industry. (PALMER,
8/Number
In Nord Norge, the greatest proportional loss had been from rural kommuner: 67 workers were living in rural areas in the region in 1972 as compared with 22 in 1974. (40 and 15 in urban kommuner in 1972 and 1974 respectively). This is a reflection of two factors. Firstly, the lack of adequate job opportunities in the region and hence the decision to migrate once a suitable opportunity elsewhere arises. However, as Nicholson (1975) points out, the registration of a migration is not unusual in the case of unmarried workers obtaining employment outside the kommunc, even though the long term intention may be to return and settle down in the kotnrnme of origin. On the other
Table 1 l
Fylke of residence 1972 Fylke/Region
Total
Percentage
Abroad 01 @tfold 02 Akershus 03 Oslo 04 Hedmark 05 Oppland 06 Buskerud 07 Vestfold 08 Telemark
50 57 51 76 22 144 27 29 41
1.52 1.72 1.55 2.31 0.67 4.38 0.82 0.88 1.25
447
13.58
24 58
0.73 1.77
82
2.5
ostlandet 09 Aust Agder 10 Vest Agder SQrlandet 11 12 14 15
Rogaland Hordaland Sogn og Fjordane M&e og Romsdal
Vestlandet 16 Sdr Trdndelag 17 Nord Trbndelag Trandelag 18 Nordland 19 Troms 20 Finnmark Nord Norge Svalbard Not given Total
812 507 101 429
24.67 15.4 3.07 13.04
1849
56.2
191 514
5.81 15.62
705
2 1.4
67 32 8
2.04 0.98 0.25
107
3.25
I 51
0.03 I .55
3292
4/ 1977
100.0
Kommune Urban
type Rural
55 44 76 1;?
? ? 0 132 30
8 22 35
19 7 6
3 28
21 30
556 187 5 45
256 320 96 384
117 11
74 503
26 14 0
41 18 8
1246
1944
Geoforum/Volume
8/Number
2-07
4/1977
Table 2 l
Fylke of residence 1974
FylkelRegion
Total
Abroad 01 Qstfold 02 Akershus 03 Oslo 04 Hedmark 05 Oppland 06 Buskerud 07 Vestfold 08 Telemark
5 26 21 22 14 140 14 17 27
0.16 0.79 0.64 0.67 0.43 4.26 0.43 0.52 0.82
281
8.5
Q)stlandet 09 Aust Agder 10 Vest Agder Sbrlandet 11 12 14 15
Rogaland Hordaland Sogn og Fjordane Mdre og Romsdal
Vestlandet 16 SQr Trdndelag 17 Nord Trbndelag Trdndelag 18 Nordland 19 Troms 20 Finnmark Nord Norge Svalbard Not given Total
20 52
0.61 1.58
72
2.18
922 585 72 448
28.01 17.77 2.19 13.61
2027
61.57
112 752
3.41 22.85
864
26.24
21 15 1
0.64 0.46 0.03
37
1.12
0 6
E.19
3292
hand, married workers, leaving their families behind, are less likely to be recorded as emigrants. Secondly, the volume of migrations from the north reflects the difficulty of commuting (on a weekly or fortnightly basis) over very long distances. Many companies provide a travel subsidy for their employees, but the costs of travelling to and from Nord Norge will, in most cases, exceed the travel allowance offered. The relationship between the degree of permanency of the various types of oil employment and the level of migration is discussed in a later section which deals with the analysis of mobility according to industrial classifications.
Kommune Urban
Percentage
-
100.0
Migrations
type Rural
23 17 22 1 11 4 11 19
3 4 0 13 129 10
1 30
19 22
643 135 322
279 450 70 416
65 0
47 752
7 8 0
14 7 1
_ _
-
1031
2250
as a Result
:
of the Oil Activities
Table 3 and Figure 4 show the pattern of migrations that have resulted from the establishment of the offshore oil industry and associated activities in the Vestlandet and Trbndelag regions of Norway. A large number of these migrations may be explained by distance in the sense that daily, weekly or fortnightly commuting is impractical. The greatest migration losses are found in those regions far removed from the centres of oil activity; a net loss of 169 workers was recorded for @stlandet and a loss of 62 oil workers from Nord Norge. In Vestlandet
there
has been
a net gain of
208
(;coforum/Volurne
g/Number
4/l 977
Table 3 l
Migrations of oil workers 1977-4
~,llkc/Rcgiorl
Abroad * 0 1 qsti-old 02 Akersbus 03 Oslo 04 Hedmark 05 Oppland 06 Buskcrud 07 Vcstfold 08 Telemark (0stlandct 09 Aust Agder IO Vest Agdet Sdrlandet
Total 5 1 0 0
I6 Sdr Trbndelag 17 Nord Trondelag Trbndelag 18 Nordland I9 Trams 30 Finnmark Nord Norge Svalbard
Total
3 0 0 0 : 0 I
0 1
0 3
4 10 14
4 X8 0 0 0
‘8
147 5 64
331 0 286
Rural
“6 __
12 0 4
Urban _ ’
4s 36 33 54 x 7 13 13 17
,
0 I 3
I 1 Rogaland 116 13 Hordaland 147 14 Sogn og Fjordane 5 15 M$re og 64 Romsdal Vestlandet
Urban
6 71 36 47
5 I9
33 34
160 0 0
0 286
73 54
27 45
28 11 6
286 1 0 0
0 0 0
39 17 7
I
0
63
0
I
.. not applicable * This indicates that 45 workers who were living abroad in 1972 bad moved to Norway by 1974.
175 oil workers, that is a gain of 332 partly balanced by a loss of 157. The greatest number of migration gains were recorded for those rural kommrtner which either had oil activity or were adjacent to kommurzw with for example, Lindgs, oil activity, Austrheim, and Rauma. However, the relatively large number of 96 migrations from rural ~W?ZUZU/WFwithout close association with the oil industry were recorded. In Trbndelag. 72. out migrations from rural
konzunL!rzer may be compared with only 55 from urban kon7r721~17c1., of which 4 1 came from Trondheim, the main urban centre in the region. One notable feature is the relatively small scale of migration to the Stavanger/Sola arca. Although there were 6 13 oil workers resident in the two li~~z~?zl~~er in 1974. this represents a gain by migration of only 89 people. This limited population effect can be explained
Geoforum/Volume
8/Number
Svalbard
4/1977
209
0
Resident abroad
Location
not gwen
Number
of employees .,
0
Figure 4
Labour
migrations
1972-74
Soutw: as Figure 1.
as a result of oil activities
km
100
Geoforum/Volume
by two factors3. Firstly, 10.7 per cent of the oil workers in the survey registered the North Sea as their place of work in 1974. This category of employment, based predominantly in the Stavanger region, entails a two week shift and thus permits a virtually unrestricted place of residence. Secondly. a large metropolitan labour market, such as the Stavanger region, can be expected to contain a large diversity of skills and thus can, to a great extent, supply its own needs internally without having to resort to tapping other labour markets for the required labour. Together, these two factors explain the apparently low impact of the oil industry on in-migration experienced in Stavanger and Sola komnuner. The converse is true for rural areas such as Verdal where a net gain of 261 workers is recorded during the period 1972 to 1974. A small labour market. comprising a limited pool of labour, cannot be expected to be able to provide all the labour requirements when a large new establishment enters the region and hence must expect to be forced to import the greater bulk of its workforce from other areas. Of the 505 workers living in Verdal lio~~~?nlrtz~, nearly 5 2 per cent of them were in-migrants. By contrast Rauma konzrt~tlne, another rural area, has had a level of in-migration which is unusually low; only 28 per cent of the recruits to the Norwegian Contractors yard at Andalsnes were in-migrants. This low level of in-migration may be explained by two factors. Firstly, the yard was, from its inccption, regarded as a short-term construction site, a factor which would deter workers from moving into the region permanently. Secondly, on the completion of the Grytten power plant in 197 1, there was severe unemployment in the liO~?Z??7ZltlC~, which meant that many of the oil construction workers were recruited locally. In fact, it was the uncmployment level in the k01171112111e which had been a spur to the establishment of the platform construction site originally. The problem of unemployment in Rauma kommum~ has, however, only been postjloned. On the completion of the Condeep 3. Vesterhus (,I9741 suggests a third factor, that of internal production adaptation within existing firms. This feature is common in the building of supply ships. but was excluded from the Directorate’s survey.
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platform for the Frigg field in June 1977, the yard had no further work and operations there have since been closed down. In general it is the rural areas far removed from the centres of oil activity which are sending workers to the oil industry. However, a simple rural/urban classification is an inadequate means of furthering this avenue of investigation of oil related migrations. Migration gains and losses are now grouj,ed according to the classification of h-ommutwt drawn up by the Norwegian Institute of Urban and Regional Research (NIBR, 1976) using 1970 Census material. The NIBR classification provides a more detailed picture of the migration of oil workers and is used below to elaborate the migration patterns. With the establishment of the offshore oil industry in Norway came the general fear that, given the very tight labour market during the period 1971 74. the increase in oil related employment would of necessity come from existing industry. It was assumed that it would be the declining primary industries, as well as some low wage secondary and tertiary industries, which would be tapped. (See, for example, STAHL-JOHANNSSEN, 1973: OLSEN, 1975 and STENSTADVOL~~. 1977). The analysis of the recruitment s~lrvey by the Directorate of Labour showed that the industrial transfers from primary industries were less serious than had been feared: only 4 per cent of those in the oil industry in 1974 had come from agriculture and fisheries. As Torgersen( 1975) points out”these main results must be seen to be particularly reassuring for those who had feared extensive poaching of the primary workforce”. While this may indeed be the case great care must be exercised in interpreting the longer-term consequences. for although it may not be the primary industries themselves which are losing employment to the oil industry, nevertheless, it is those areas which have a strong dependency on primary activities that are the main “sending” areas. It is consistently found that the greater number of emigrants from rural areas have their occupations in secondary and tertiary sectors rather than in the primaly sector. (NlcIjOLSON, 1975). Nevertheless, an emigration from a primary area serves to undermine the local economic base. depriving the 1\0/)7/>71//1<’ of its workforce in a valuable
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sector of activity. Such migrations may, in fact, be more harmful to the community than a migration from the primary sector. Underemployment is a common feature in primary industries, so that an employee can be lost without any effect on productivity. The same may not be true for secondary and tertiary employment. The probability that the emigration of a secondary or tertiary worker sets off a chain reaction of sectoral transfers from primary activities in order to fill a vacancy is perhaps greater in areas which have a higher proportion of their workforce in the primary sector. This theme of structural changes in employment will be taken up later in the section on industrial mobility. Of the 3292 oil workers interviewed, 636, approximately 20 per cent, changed their place of residence between 1972 and 1974. Table 4 gives a breakdown of these residence changes by k~?nrnt~n~ type using the NIBR classification.
It is emphasised that this picture does not imply that primary industries themselves are losing employees to the oil industry. The table does, however, show the types of kommuner that are “sending” areas; the strong emergence of agricultural and fishery k~rnrnz~~er is noted. Also of interest is the fact that “Stagnating manufacturing kommuner” also make a significant contribution to the pattern of out migrations. It could be suggested that the explanation of this pattern lies in the distance factor, that is that the location of the oil activities, in particular at Wndalsnes and Verdalsqira, are in the regions where primary kommuner comprise a large proportion of the total number of kommurzer. Indeed, it has been found that 19 per cent of the migrations from primary k~mmu~zer came from within 50 km of the oil centres. However, these losses from kommuner adjacent to the oil centres do not necessarily represent a migration to the nearest oil centre; in some cases they are migrations to more distant centres of oil employment.
Tabie 4 l
Migrations of oil workers by
kommune type Gains ofwhich 16 2
Losses 105 24 and service kommuner 21
Kommune [vpe One sided agricultural kommuner Fishery kommuner i Stagnating manufacturing I
Mixed agricultural
and m~ufactu~ng
t Regional centre kommuner ( Suburban
kommuner
\ Large urban kon~muner Abroad Svalbard Not given Total
The kummu~ze~ with gains in population are of less interest from this point of view as the distribution is a function of the classifications of those kommuner which have oil activities within their bounda~es. Only the figures for migration losses are discussed here. These are weighted according to the proportion of national population in each class and the weighted values are given in Table 5.
kommuner
1
65 59
45
34
226
89
= 62 = 261 = 20
Sola Stavanger = 58 Sandnes = 28
45 4: 545+91
636
The weighted values for out migrations show that over 36 per cent of the out migrations came from primary kommuner (“one sided and “fishery” agricultural” kommuner), whereas only 16 per cent of the national population is to be found in these areas. It can thus be argued that the impact of the oil industry on the primary sector is greater than was at first supposed. A similar conclu-
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Table 5 l
Weighted migration
Kommutw
losses by kommune
type
Weigh ted Percentage of Migration loss National Population
type
One sided agricultural kotnmuner Fishery kommuner Stagnating manufacturing and service kommuncr Mixed agricultural and manufacturing kommutzer Regional ccntre kommutzcr Suburban kommuner Large urban kommutw
” 0 14.25 16.25 10.1-S 15.75 7.75 13.75
_u.
100
Total
Oil Workers
Industrial origins of the oil workforce and the industrial distribution of the economically active population in Norway in 1972. (Percentages)
Not in employment in 1972. including Agriculture, forestry Fisheries Mining, manufacturing Building and Construction Trade, hotels and restaurants Sea transport Other transport and communications Other . Not given
sion is reached for the impact on industrial mobility disucssed in the next section.
The Industrial
4.19 3.24 15.80 9.37 14.64 40.90 100
Table 6 l
11.88
Patkrrz
ojfRemritmen
t
The second major cause for concern after the establishment of the offshore oil industry
in Norway was that the creation of a new form of industrial activity in a country with a tight labour market might cause too rapid structural changes in employment. In Norway, as in other industrialised countries, there has been a shift away from dispersed forms of economic activity towards industries more compactly located; this in the main represents a shift from rural occupations to urban activities. The economy may be divided into two sectors, one sheltered, the other exposed. The first comprises industries producing for the domestic market which have negligible foreign competition. These include some service industries and building and construction. The second group consists of those industries that produce goods for export and for domestic consumption and which face strong competition from overseas; examples are the textiles and furniture indus-
unemployed
19.4 3.1 I .o 24.4 28.8 5.6 5.5 3.3 7.4 1.5
Norway
10.6 1.5 25.4 8.7 16.0 9.8 27.7
tries. It is these industries which are finding it extremely difficult to survive and which might be expected to be main suppliers of labour to the oil industry. In addition it was felt that the oil industry might accelerate the shift away from the primary industries which are also shedding labour. Table 6 shows the industrial distribution of the oil workers in 1972 compared with that of the economically active population in Norway as a whole for the same year. As a result of the strong bias of the survey towards construction and installation work, it is not surprising that mining, manufacturing, building and construction are strongly represented as industrial origins of the oil workforce; together, these sectors comprise 53 per cent of the total. The nature of the industrial classification (SIC orders) surveyed (see Table 7) largely explains the industrial pattern of recruitment. In fact, most of those workers in the survey did not change industries at all. This is a function of the fineness of the industrial
Geoforum/Volume 8/Number 4/ 1977
classification used. Since the classification for industry in 1972 used in the survey was very broad, it precludes any detailed analysis of inter-industry transfers. Table 7 l
Industrial grouping for recruitment survey (percentages)
Extraction and Production of oil and gas Refineries Platform Construction Construction Catering Transport and Storage Engineering, architectural and technical services Cleaning services
8.1 6.4 57.0 10.8 2.8 14.1 0.3 0.2
Structural changes in employment are mainly effected by means of movements into and out of the labour market (PALMER, 1954). Thus expanding industries have, as their main source of recruits, young persons entering the labour force for the first time. Conversely, as older workers leave contracting industries, (they may be encouraged to retire early), they are not replaced and a rundown in employment is achieved. In other words, transfers of employees between industries are not the main way in which structural changes in employment are brought about. However, if expansion occurs rapidly, as in the case of the offshore oil industry, then it is inevitable that transfers from other industries will take place; in the same way the rapid run down of a plant will lead to redundancies. In the case of the oil industry some 19.4 per cent of recruits were not previously in employment, the low figure reflecting the idea that the oil industry, for the most part, requires skilled workers with some industrial experience. Patterns of industrial recruitment are largely set by occupational factors (MACKAY et al., 1972). Thus. those involved in catering, transport and construction in 1972 are most likely to move into these areas of the oil industry. For service base operations the recruitment level from sea transport is high (17.0 per cent) see Table 8.
One group of activities which have no apparent occupational link with the oil industry is the primary sector, that is agriculture,
forestry and tishing.4 Together this group comprised 4.1 per cent of what was to be the oil workforce in 1974, compared with some 12 per cent of the total workforce for the country as a whole. These results must, however, be taken with some caution. One shortcoming of the survey is the fact that it records only one step in the reallocation ladder. For example Salt (1967) has shown that in the case of the Ford and Vauxhall plants in the United Kingdom, which were located in Merseyside in order to help the unemployment situation, only 8.7 per cent of the recruits came from the ranks of the unemployed. However if the balance of workers came from other industries, then in theory, a number of vacancies are created in those industries. So although at first glance, the new plants appear to have done little to ease unemployment in the area, it is necessary to consider the “rippling effect” (GRIME and STARKIE, 1968) or the chains of job changes which such a plant might set in motion. Although the Recruitment Survey cannot itself indicate these chains of linkage which an occupational life history survey would be able to do (see, for example, RAM SOY, 1975) some work in this connection has been carried out. HUNTER and REID (1970) quote a French study which has shown strong movements of workers from agriculture to building and construction. After a period of time giving some industrial experience, these workers are able to move on to better jobs in manufacturing. In other words, building and construction acts as an intermediary occupation for transfers from primary to manufacturing activities. In Norway, the Building Research Institute (NBI) has compiled information on recruitment patterns to building and construction (HEGNA, 1974). The study showed that 20 per cent of recruits to the industry who had had previous employment came from the primary industries and the figure was even higher for commuters (32 per cent). This latter feature suggests that former primary workers usually wish to maintain their contact with primary activities and so do not tend to move to their work site permanently, but rather prefer to commute. Given the 4. In Norway, industry.
mining is classified as a secondary
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uncertain nature of construction work, it is not surprising that the worker is reluctant to give up the holding which once provided him with his livelihood. The survey showed that it was the large cities which were most important as workplaces, but were of little importance as recruitment or residence places.
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construction sector. The impact of the oil related activities is thus much greater than is at first imagined. An analysis of the recruitment patterns of other forms of economic activity which are expanding, or at least maintaining, their current levels of employment and are at the same time sending some
Table 8 l
Industrial
Industry
origins of oil workforce by workplace in 1974. (percentages)
1972
Agricultural and Forestry Fishing Mining and Manufacturing Building and Construction Trade, Hotels and Restaurants Sea Transport Other transport and communications Other Not given
Stavanger 2.5 0.2 13.3 45.2 5.5 2.7 4.4 6.5 3.4
For rural kornmuner, the converse was true. In connection with the oil industry it should be noted that a large part of the construction activity is located in rural areas, thus enabling a reduction in the traditional separation between workplace and residence for construction workers. These findings have some utility as regards the oil Recruitment Survey. Figure 5 shows the possible backward linkages for recruitment to the oil industry, based on the findings of the Recruitment Survey itself and the NBI report by Hegna. Of the 2245 workers in oil related construction in 1974. 647 (28.8 per cent) had come from other types of construction activity. By using the Hegna report, it is possible to say that if construction activity was to be maintained at the same scale, then the same number of vacancies would exist in the construction industry and this in turn would set in motion flows from other industrial groups. These flows would follow the pattern suggested by Hegna. Some 20 per cent would come from primary activities, so that for the 2245 construction jobs created in the oil industry, some 221 primary jobs would be lost. That is to say, 92 would move directly from the primary sector to oil related construction and another 129 would move from primary activities into the vacated construction jobs in the general
Sola 0.4 0.4 30.2 5.6 10.9 5.2 4.4 16.5 0.8
Fjell 2.8 0 47.2 13.9 5.6 11.1 0 5.6 0
Lind”as
Rauma
Verdal
North Sea
2.0 0 20.1 33.9 5.0 6.9 1.3 9.1 3.3
4.9 1.7 14.7 46.7 3.5 2.1 2.5 2.8 1.2
4.4 0.7 44.1 12.8 5.4 4.2 I .9 3.2 0
1.1 2.0 31.8 7.9 7.6 17.0 9.9 17.6 0.3
of their workers to the oil industry, may reveal further indications that primary industries are being tapped as a source of labour to the oil industry on a scale more extensive than that suggested by the Recruitment Survey. The backward linkages suggested by this analysis of construction workers leads to the conclusion that chains of job changes may be initiated by the expansion of a single industry. This inputGoutput effect is not confined to the primary sector and may be equally as strong for other industries, and it is an area which must receive further attention in the future debate about the impact of North Sea oil on structural changes in employment. The NBI study also indicated that the characteristics of the area in which the new activity is located influence the industrial pattern of recruitment. Projects located in rural areas have a greater proportion of recruits from primary activities than do those located in more urbanised areas. This is because labour tends to be recruited locally, as far as possible, and thus in a rural area the greatest probability of transfer is from a rural occupation. Table 8 shows that this is a feature confirmed in the Recruitment Survey. Rauma
and Verdal
recruited
4.9 and 4.4 per
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in employment
entrantsto
1
(new labour
the
OIL and
force,
or
I-
unemployed)
RELATED
Restaurants
Figure 5 l
Patterns of recruitment
to oil related construction
Source: HEGNA, 1974. ARBEIDSDIREKTORATET. respectively from agriculture and fores try, compared with only 2.5 and 0.4 per cent for the more urbanised I?OI?I~Z~IHCY of Stavanger and Sola. Origins in secondary activities are largely explained by the nature of the oil activity in each hnmtrne. Building and construction are strong origins for those engaged in platform construction at Rauma and mining and manufacturing emerge as important sources of labour for those employed at Aker Verdal. Although this latter yard is classified as a platform construction site, the work is the construction of steel jackets and decks and therefore requires welding skills which are characteristic of rather than construction manufacturing activity.5 cent
The main conclusion from this analysis of labour mobility resulting from the establishment of the oil industry in Norway is that the impact on primary employment may be greater than was at first apparent from an 5. This confusion arises from the fact that the oil activities were classified in the Recruitment Survey using the ISIC. ISIC order 3824 “manufacture of comprises not only concrete industrial machinery” but also steel platform construction; a five-digit classification would not ease the problem since order 38241 is “manufacture of oil and gas well machinery and tools”. Steel and concrete platform construction have totally different skill requirements, thus some thought needs to be given to a precise definition of the “oil industry” and its components.
and to building and construction.
1975.
initial study of the recruitment patterns. This is for two reasons. Firstly, this analysis has shown that the primary h-omm~ner (those classified under the NIBR classification “one sided agricultural” and “fishery” %nlrnunc~) have been the greatest losers of population from migrations resulting from the oil activities. Secondly, the rippling effect of new industries means that chains of job changes result from the increased manpower requirements of a single plant since the rapid expansion of a plant means that the labour needs cannot be met solely from the natural increase in the economically active population. Recruitment patterns are coloured not only by occupational factors, but also by the characteristics of the location in which the new industry is sited. Close occupational linkages between two industries ensures a strong recruitment link when one is expanding. Large urban labour markets can generally supply their own needs for labour whereas rural areas must expect to import a large proportion of the required workforce. Finally, the permanency of employment influences the decision to migrate. Workplaces perceived as being temporary are unlikely to encourage labour to migrate if there is the possibility that there will be a shutdown within a short period, as in the case of hdalsnes, which had had an operation time of three and a half years when it closed in
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the summer of 1977. These features of the oil industry must serve as a basis for the formulation of an active manpower policy.
OiE and Manpower Policy The traditional view of Iabour nlobility is that it is important to the proper functioning of the labour market as it brings about a more efficient redistribution of labour by channelling workers into expanding industries and away from contracting ones, so increasing productivity. Thus an active manpower policy has as a key objective the encouragement of these transfers. With the tradition of underemployment in some forms of economic activity, such as agriculture, and the slow decline of certain manufacturing sectors together with the rapidly expanding employment needs of the oil industry (at least in its early stages of development), a policy of encouragement of mobility is possible for the Norwegian oil situation. However, in Norway, as noted above, the dispersed pattern of settlement and the small scale of industrial enterprises are traditional features which are highly valued, and there is considerable interest in maintaining the present pattern. ‘171~s manpower policy tends to be socially oriented rather than efficiency conscious. In addition, the oil industry is a particularly uncertain form of activity. In recent months it has become apparent that some sectors of the industry will not continue to expand at the previous rate and some, notably platform construction, will even decline. Another characteristic of the oil industry, and in particular the construction sector, is that employment levels fluctuate considerably over time. A large number of workers may be taken on for a period of 3 to 6 months in order to complete a platform on schedule for float-out during the spring/summer “weather window”. The same workers may then be made redundant. A single manpower policy for the oil industry would thus be ~lnsatisfacto~ given its very diverse nature. It may be useful to classify the oil related activities on the basis of their permanency in order to determine suitable manpower policies. Three
types
of oil related
activities
may be
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distinguished and different policies encouraged for each. Firstly, employment opportunities in, for example, refineries and service bases, may be regarded as permanent, assuming a long-term depletion policy for the North Sea. It may, therefore, be acceptable to encourage workers to move into such activities and to migrate to the regions in which these activities arc located. For semi-permanent oil jobs, such as the construction and repair of steel rings and platforms, much of the work may be utldertakell in previously existing shipyards where the main labour force is already prosent. Extra labour may be brought in when contract commitments demand a speedy completion of the order. Workers already in the same industry, but in other locations, may perhaps be helped to move on a temporary basis so as to help to complete the contract. The Aker Group in Norway has the greater share of this type of activity and, having shipyards scattered throughout the country, has the possibility to transfer its employees to the locations in which they are required. The increased labour requirements at Akcr’s yard at Stord, in March 1977, and the surplus of labour at Aker Verdal, meant that Verdal workers could be given priority for jobs at Stord if they were willing to move. Thirdly, building and construction are forms of cmploymen t which are traditionally teniporary and which require a rather different manpower policy. Examples of construction activity in the oil industry are concrctc ~~latfo~ co~~str~lctiol~ and the corlstl-~ictio~l of oil refineries and plant for other “‘downactivities. In the case of plant for stream” such downstream activities. the project could be phased so that a small scale of activity could take place over an extended period of time. For platform c(~nstrLlctio~l. the sc‘paration of the different functions of each platform co~tld enable orders to be distributed amongst several yards, rather than the construction of a giant multifunctional platform. such as Statfjord A. at a single yard. A separate ~~ccoI~~l~~odatio~iplatform is, for safety reasons, being demanded by the Norwegian Pctrolcum Directorate for Statfjord B, and the orders for the production system are cxpcctcd to be placed by the end of this year. This could enable the orders to bc placed at several yards throughout the counlarge scale c~~li~~~lti-~~tc~l try so replacing
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and its resultant problems with small scale dispersed activity. The latter fitting more naturally with the traditional pattern of economic activity in Norway.
employment
Dependence on temporary employment is an unsatisfactory state for a local economy. The completion of the Grytten power plant in Rauma in 1971 left a pool of unemploynlent which has partially been taken up by the establishment of Norwegian Contractors at Andalsnes. This has subsequently proved another temporary project since the lack of orders for offshore structures has hit Norwegian, as well as British, platform construction sites. From Norway’s point of view it might be more satisfactory to have Norwegian designed offshore structures built abroad under licence. However, projects involving job creation, regardless of how temporary, will often be given a favourable reception from local authorities. Even if the problems of temporary construction employment are recognised, the deep water fjords of Norway may be the only suitable locations for the construction of some platforms. In this case, one solution might be to bring in foreign workers, or long-distance commuters, rather than allow the local workforce to participate in the project. This would enable the unemployment problem to be dispersed once the project had been completed. Such a policy was attempted by Zetland County Council for the Sullom Voe terminal in the Shetlands, but pressures from the local workforce for involvement soon eroded the Council’s policy, and locals were eventually employed on the project. In terms of the industrial redistribution of labour, the permanency of employment is also of inlportance. Having once moved from one industry to a newly established industry, the chances of returning to the original industry are small. Either the sending firm has been unable to continue as a result of loss of labour and an inability to replace the workers who have left (perhaps as a result of unattractive wage levels or working conditions) or the vacancies have been filled. In either case there is seldom an opening for the returning worker. Conclusion
The Recruitment Survey has been an attempt to assess the impact on employment of North
Sea oil in Norway, in particular by examining the geographical and industrial patterns of recruitment to the oil industry. This paper has shown that there has been a movement towards Vestlandet and Trbndelag and considerable migration losses from primary industry kommurwr. In terms of industrial transfers, the initial fear for a loss from primary activities is apparently unfounded. The caution about rippling effects is, however, expressed since the total effect on industrial transfers of the establishment of a new industry is not necessarily apparent from an analysis of one step in the scheme of interindustry movements. The nature and characteristics of the oil activities should be fully understood before any active manpower policy can be applied. Transfers effected as a result of initial “Klondike fever” may, in a relatively short period, turn out to be bad decisions which prove detrimental to economic growth. The traditional view that mobility in the labour market is a healthy sign which suggests an efficient functioning of the economy may thus be misguided.
~ck~~~~~~gern~~~~ - This paper forms part of the author’s Ph.D. research which was undertaken with the aid of support from the Social Science Research Council and the Dudley Stamp Memorial Fund. The author would like to thank Mr. D. J. Sinclair, Mr. D. R. Diamond and Kjell Stenstadvold who read and gave helpful comments on the first draft of this paper. Thanks are also due to Janet Baker who, with great care and patience, drew the maps. References
ARBEIDSDIREKTORATET ved oljeaktivitetene, direktoratet, Oslo,
(1974) SysseZsertingen
August,
19 74.
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(1975) Rekrutteringsunderqbkelsen H&ten 1974. Arbeidsdirektoratet, Oslo. A ~et~~olo~cal Study of BOGUE D. J. (1952) M&ration and Labour Mobility. Scripps Foundation Studies in Population Distribution. No. 4. GRIME E. K. & STARKIE D. N. M. (1968) New jobs for old: An impact study of a new factory in Furness. Reg. Studies 2, pp 57-67. HEGNA T. J. (1974) Arbeidskraf?unders~kelsen i Norges bygge og an~eggsbransjen I 9 73/4. Byggforskningsinstitutt, Oslo. Arb. Rapp. 74/O3661. ARBEIDSDIREKTORATET
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HOPE E. (1975) N~erings~koiliskc Konsekvenser in Norsk Oljepolirikk. WYLLER K. B. & T. C. Gyldendal Norsk Forlag. HUNTER L. & REID G. (1970) Urban Worker Mobility. O.E.C.D. 2 I5 pp. MACKA:’ D. I. ct al. (1972) Labour Markers Under Differed t Ernp~oy~~e~r ~~~~l~~~~~~~s, Allen & Unwin, 433 pp. NIBR ( 1976) Erfaringer fra Gerwralplanarbcidet. Norsk Institutt for By-og Regionforskning, Oslo. NICHOLSON B. (1975) Return Migration to a an example from Northern Marginal Rural Area Norway. Sociulugia Ruraiis. 15, 227-44. NORDI~US 0. (1976) Norway as an Oil Nation. Norges Bank Economic Bullefin. XLVII (3), pp 150-160. OLSEN R. (1975) Oljens konsekvenser for norsk naeringsliv. Norges Zndustri 57, pp 24&?7. PALMER G. (1954) Interpreting Patterns of Labour Mobility. in BAKKE E. W. (ed.) Lab~jt~r~~hi~i~~~ and ~c~~no~rtic Opp~~r~u~~ity.Wiley & M I .=r Press, 1 IS pp.
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RAMS@Y N. R. (1975) Oe~,l~p~~i~~~la~ Lijti Historic Study. Institute fur Applied Social Kcsearch. University of Oslo. (mimeo) SALT J. (1967) The impact of the Fol-d and Vauxhall plants on the employment situation in Merscyside, 1961 -65. T.V. E.S.G. LVIII(5). pp 255 64. STAHL-JOHANNESSEN, K. (1973) Oljen vil tappc annen industri for arbeidskraft. Norges Indusrri. 51 pp 6--8. STENSTADVOLD K. (I 977) Regional and Structural Effects of North Sea Oil in Norway. Mcddelclser fra Geografisk Institutt ved Norges Handclshoyskole og Universitetet i Bergen NI-. 37, 55pp. STORTINGS MELDING Nr. 15 (1973 74) Perrw Iezinll?irsonllretetIsplass i der twrskc snmfirmz. Finansdepsrtementet. Oslo. TORGERSEN L. (1975) Arbeidskrat’ten Cl1 Knapphetsfaktor? Plan og Arbeid Nr. 3, XX W. VESTERHUS T. (1974) F(vttinger .fLu og ri/ Salianger. Rogalands ~istriktsll~y~k(~le.