Elin Svarstad

Fafo Institute for Labour and Social Research, Oslo

Wage effects in the Norwegian constructing – an industry with major changes

Elin Svarstad, Fafo Institute for Labour and Social Research, Oslo
Bård Jordfald, Fafo Institute for Labour and Social Research, Oslo

We will study wage growth and wage dispersion in the Norwegian construction industry. In the paper we focus on descriptive findings concerning wage development. We are interested in how legal extension of collective agreements (LECA) has affected the wage distribution in the industry, and how the LECA affects different crafts.

In relation to the size of the workforce, the Norwegian labor market was among those who absorbed most workers from the new EU countries . Workers from Polen, Lativa, Lithuana and other countries has entered the Norwegian labor market the last two decades.

In comparison to most other European Countries, there is no statutory minimum wage in Norway. The shift in the supply side in the labor market following the 2004 enlargement of EU put a pressure on the wage levels in several industries. As an instrument to avoid downward pressure on the wages, Norwegian Unions implemented legal extensions of the collective agreements (LECA). The purpose of the LECA is to ensure that foreign workers receive wage conditions that are equivalent to the conditions Norwegian workers have, and to prevent competition distortion to the disadvantage of the Norwegian labor market.

We will use the wage statistics collected by the Statistics Norway to analyze the developments in wages in the construction industry. First we will look into the aggregated increase in wages for the period, and how this increase is distributed. Secondly, we will analyze different crafts in the industry. We want to examine how the wages of workers with different qualifications is  affected by work immigration.

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