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Norway performs exceptionally well in overall well-being, as shown by the fact that it ranks among the top countries in a large number of topics in the Better Life Index.
Money, while it cannot buy happiness, is an important means to achieving higher living standards. In Norway, the average household net-adjusted disposable income is 31 459 USD a year, more than the OECD average of 23 047 USD a year. But there is a considerable gap between the richest and poorest – the top 20% of the population earn four times as much as the bottom 20%.
In terms of employment, over 75% of people aged 15 to 64 in Norway have a paid job, above the OECD employment average of 66%. Some 77% of men are in paid work, compared with 73% of women. People in Norway work 1 426 hours a year, less than the OECD average of 1 776 hours. Only 3% of employees work very long hours, much less than the OECD average of 9%, with 4% of men working very long hours compared with just 1% for women.
Having a good education is an important requisite for finding a job. In Norway, 81% of adults aged 25-64 have earned the equivalent of a high-school degree, higher than the OECD average of 74%. This is equally true of men and women. In terms of the quality of the education system, the average student scored 500 in reading literacy, maths and science in the OECD’s Programme for International, higher than the OECD average of 497. Student Assessment (PISA). On average in Norway, girls outperformed boys by 15 points, higher than the average OECD gap of 9 points.
In terms of health, life expectancy at birth in Norway is 81 years, one year higher than the OECD average of 80 years. Life expectancy for men is 79 years, compared with 84 for women. The level of atmospheric PM10 – tiny air pollutant particles small enough to enter and cause damage to the lungs – is 15 micrograms per cubic meter, considerably lower than the OECD average of 21 micrograms per cubic meter. Norway also does well in terms of water quality, as 96% of people say they are satisfied with the quality of their water, compared with an OECD average of 84%.
Concerning the public sphere, there is a strong sense of community and high levels of civic participation in Norway, where 93% of people believe that they know someone they could rely on in time of need, higher than the OECD average of 90%. Voter turnout, a measure of public trust in government and of citizens’ participation in the political process, was 76% during recent elections, higher than the OECD average of 72%. Social and economic status can affect voting rates; voter turnout for the top 20% of the population is 83% and for the bottom 20% it is 70%, a slightly broader gap than the OECD average gap of 12 percentage points.
In general, Norwegians are more satisfied with their lives than the OECD average, with 86% of people saying they have more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc) than negative ones (pain, worry, sadness, boredom, etc). This figure is higher than the OECD average of 80%.
OECD in Action
OECD Economic Surveys: Norway 2014
This 2014 OECD Economic Survey of Norway examines recent economic developments, policies and prospects. Special chapters cover real estate markets and financial risk and entrepreneurship.Read this report
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Norway in Detail
Housing – Norway expand
Living in satisfactory housing conditions is one of the most important aspects of people’s lives. Housing is essential to meet basic needs, such as shelter, but it is not just a question of four walls and a roof. Housing should offer a place to sleep and rest where people feel safe and have privacy and personal space; somewhere they can raise a family. All of these elements help make a house a home. And of course there is the question whether people can afford adequate housing.
Housing costs take up a large share of the household budget and represent the largest single expenditure for many individuals and families, by the time you add up elements such as rent, gas, electricity, water, furniture or repairs. In Norway, households on average spend 18% of their gross adjusteddisposable income on keeping a roof over their heads, below the OECD average of 21%.
In addition to housing costs it is also important to examine living conditions, such as the average number of rooms shared per person and whether households have access to basic facilities. In Norway, 91% of people say they are satisfied with their current housing situation, more than the OECD average of 87%. This high level of subjective satisfaction reflects Norway’s good performance in objective housing indicators.
The number of rooms in a dwelling, divided by the number of persons living there, indicates whether residents are living in crowded conditions. Overcrowded housing may have a negative impact on physical and mental health, relations with others and children’s development. In addition, dense living conditions are often a sign of inadequate water and sewage supply. In Norway, the average home contains 2.0 rooms per person, more than the OECD average of 1.6 rooms per person. In terms of basic facilities, 99.7%of people in Norway live in dwellings with private access to an indoor flushing toilet, more than the OECD average 97.8%.
More ResourcesHow's Life? at a Glance
Income – Norway expand
While money may not buy happiness, it is an important means to achieving higher living standards and thus greater well-being. Higher economic wealth may also improve access to quality education, healthcare and housing.
Household net-adjusted disposable income is the amount of money that a household earns each year after tax. It represents the money available to a household for spending on goods or services. In Norway, the average household net-adjusted disposable income is 31 459 USD a year, higher than the OECD average of 23 047 USD.
Household financial wealth is the total value of a household’s financial worth. In Norway, the average household net financial wealth is estimated at 6 905 USD, lower than the OECD average of 40 516 USD. While the ideal measure of household wealth should include real assets (e.g. land and dwellings), such information is currently available for only a small number of OECD countries.
Despite a general increase in living standards across OECD countries over the past fifteen years, not all people have benefited from this to the same extent. In Norway, the average net adjusted disposable the income of the top 20% of the population is an estimated 53 912 USD a year, whereas the bottom 20% live on an estimated 14 621 USD a year.
Better Policies for Better Lives
Redistribution for an egalitarian society
Norway’s society is built on the model of a relatively egalitarian society, where social consensus and a high degree of inclusiveness are important, and there is a high level of social cohesion. Wage inequality is low, and redistribution through the tax and benefit system is large, so that the distribution of net income is even more egalitarian.
Norway’s progressive tax system, which includes quite a high wealth tax, raises a lot of revenue, helping to reduce income inequality, without excessively undermining economic performance. However, taxation varies across different types of income and the low levels of property taxation combined with very high tax rates on some capital income are likely to depress non-housing investment. The harsh tax treatment of bank interest particularly affects poorer households who are more likely to use this type of savings instrument.
The government could reform the taxation of capital and align tax rates across different types of income to improve economic efficiency through greater tax neutrality without reducing the overall degree of redistribution.
More ResourcesHow's Life? at a Glance
Jobs – Norway expand
Having a job brings many important benefits, including: providing a source of income, improving social inclusion, fulfilling one’s own aspirations, building self-esteem and developing skills and competencies. In Norway, more than 75% of the working-age population aged 15 to 64 has a paid job. This figure is much higher than the OECD employment average of 66%. Employment rates are generally higher for individuals with a higher level of education; in Norway an estimated 88% of individuals with at least a tertiary education have a paid job, compared with an estimated 56% for those without an upper secondary education. This 32 percentage point difference is slightly lower than the OECD average of 37 percentage points and suggests the job market in Norway is relatively inclusive.
Women are still less likely than men to participate in the labour market. In Norway, 73% of women have jobs. This is more than the OECD average of 60% and relatively close to the 77% employment rate of men in Norway. This 4 percentage point gender difference is much lower than the OECD average difference of 12 percentage points and suggests Norway has been successful in addressing the constraints and barriers women face accessing work.
Young Norwegians aged 15-24 face an unemployment rate of 8.6%, compared with the OECD average of 16.2%.
Unemployed persons are defined as those who are not currently working but are willing to do so and actively searching for work. Long-term unemployment can have a large negative effect on feelings of well-being and self-worth and result in a loss of skills, further reducing employability. In Norway, the percentage of the labour force that has been unemployed for a year or longer is currently at nearly 0.4%, much lower than the OECD average of 3.1%. There is little difference on average between men and women in the OECD area when it comes to long-term unemployment. In Norway, the long-term unemployment rate for men and women is nearly the same, at respectively 0.5% and 0.3%.
The wages and other monetary benefits that come with employment are an important aspect of job quality. In Norway, people earn 43 990 US dollars per year on average, more than the OECD average of 34 466 USD.Not everyone earns that amount however. Whereas the top 20% of the population earn 48 724 USD per year, the bottom 20% live on 30 366 USD per year.
Another essential factor of employment quality is job security. Employees working on temporary contracts are more vulnerable than workers with an open-ended contract. In Norway, close to 8% of total employees have a contract of 6 months or less, slightly lower than the average of 10% for 30 OECD countries. This figure suggests Norway has been successful in stabilising working contracts and encouraging open-ended contracts.
More ResourcesWell‑being in the workplace: Measuring job quality
Community – Norway expand
Humans are social creatures. The frequency of our contact with others and the quality of our personal relationships are thus crucial determinants of our well-being. Helping others can also make you happier. People who volunteer tend to be more satisfied with their lives than those who do not. Time spent volunteering also contributes to a healthy civil society. On average, people in Norway spend 2 minutes per day in volunteering activities, less than the OECD average of 4 minutes per day. Around 53% reported having helped a stranger in the last month, more than the OECD average of 48%.
A strong social network, or community, can provide emotional support during both good and bad times as well as provide access to jobs, services and other material opportunities. In Norway, 93% of people believe that they know someone they could rely on in a time of need, more than the OECD average of 90%. There is no difference between men and women. While on average in the OECD there is a clear relationship between the availability of social support on the one hand, and people’s education level on the other, in Norway there is little difference: around 91% of people who have completed primary education report having someone to count on for help in times of need, compared to 94% for people who attained tertiary education.
A weak social network can result in limited economic opportunities, a lack of contact with others, and eventually, feelings of isolation. Socially isolated individuals face difficulties integrating into society as a contributing member and fulfilling personal aspirations.
More ResourcesHow's Life? at a Glance OECD Insights: Human Capital
Education – Norway expand
A well-educated and well-trained population is essential for a country’s social and economic well-being. Education plays a key role in providing individuals with the knowledge, skills and competences needed to participate effectively in society and in the economy. Most concretely, having a good education greatly improves the likelihood of finding a job and earning enough money. Across OECD countries, 83% of people with university-level degrees have a job, compared with just below 56% for those with only a secondary school diploma. Lifetime earnings also increase with each level of education.
Following a decline in manual labour over previous decades, employers now favour a more educated labour force. High-school graduation rates therefore provide a good indication of whether a country is preparing its students to meet the minimum requirements of the job market. In Norway, 81% of adults aged 25-64 have earned the equivalent of a high-school degree, higher than the OECD average of 74%. Across the OECD, slightly more men aged 25-64 have the equivalent of a high-school degree compared with women from the same age group. In Norway, the educational attainment rates of men and women are similar at 81% for men and 80% for women. Among younger people – a better indicator of Norway’s future – 83% of 25-34 year-olds have earned the equivalent of a high-school degree, slightly more than the OECD average of 82%.
Norwegians can expect to go through 17.9 years of education between the ages of 5 and 39, more than the OECD average of 16.5 years. This high level of education expectancy echoes Norway’s good performance in the educational attainment of its 25-34 year-old population.
But graduation rates, while important, speak little to the quality of education received. The OECD’s Programme for International Student Assessment (PISA) reviews the extent to which students have acquired some of the knowledge and skills that are essential for full participation in modern societies. In 2009, PISA focused on examining students’ reading ability, skills in maths and level in sciences, as research shows that these skills are more reliable predictors of economic and social well-being than the number of years spent in school.
The average student in Norway scored 500 in reading literacy, maths and sciences, higher than the OECD average of 497. On average, girls outperformed boys by 15 points, more than the average OECD gap of 9 points.
The best-performing school systems manage to provide high-quality education to all students. In Norway, the average difference in results, between the 20% with the highest socio-economic background and the 20% with the lowest socio-economic background is 77 points, lower than the OECD average of 99 points and one of the smallest gaps amongst OECD countries. This suggests the school system in Norway provides relatively equal access to high-quality education.
Better Policies for Better Lives
Establishing career incentives in Norway
In Norway, governments and unions have co-operated to enhance and recognize teachers’ competence. The Union of Education Norway (UEN) had long considered that there were too few career incentives for teachers. Existing career structures meant that teachers stopped teaching or taught less when they entered positions of educational leadership. In the 2008, the UEN suggested introducing a new and higher wage scale for teachers on the basis of competence. The suggestion was accepted, and procedures were agreed to promote and retain highly competent teachers, as identified by the school leader.
Additionally, the UEN formed a partnership with the Norwegian Ministry of Education and other organizations to introduce a system of ongoing education for teachers. Around 2 000 full-time study places in colleges and universities have been set aside for full- or part-time studies. Teachers who participate are granted leave of absence with full pay for 80% of normal study time. Costs for substitute teachers are shared between the central government and the local employer.
More ResourcesHow's Life? at a Glance
Environment – Norway expand
The quality of our local living environment has a direct impact on our health. Having access to green spaces for example, is essential for quality of life. An unspoiled environment is a source of satisfaction, improves mental well-being, allows people to recover from the stress of everyday life and to perform physical activity. According to the latest available figures, in Norway, 2% of people feel they lack access to green spaces, much less than the 12% average of OECD European countries, and the highest satisfaction level.
Outdoor air pollution is one important environmental issue that directly affects the quality of peoples’ lives. Despite national and international interventions and decreases in major pollutant emissions, the health impacts of urban air pollution continue to worsen, with air pollution set to become the top environmental cause of premature mortality globally by 2050. Air pollution in urban centres, often caused by transport and the use of small-scale burning of wood or coal, is linked to a range of health problems, from minor eye irritation to upper respiratory symptoms in the short-term and chronic respiratory diseases such as asthma, cardiovascular diseases and lung cancer in the long-term. Children and the elderly may be particularly vulnerable.
PM10 – tiny particulate matter small enough to be inhaled into the deepest part of the lung – is monitored in OECD countries because it can harm human health and reduce life expectancy. In Norway, PM10 levels are 14.8 micrograms per cubic meter, lower than the OECD average of 20.9 micrograms per cubic meter and the annual guideline limit of 20 micrograms per cubic meter set by the World Health Organization. Total emissions of particulate matter (PM10) have reduced by 29% since 2000, mostly due to lower emissions from fuel wood use; nevertheless, the use of wood for household heating is still the largest source, accounting for 60% of PM10 emissions. Other sources include minerals and metals production (22%) and transport (10%), which covers exhaust, road dust and tyre wear.
Access to clean water is fundamental to human well-being. Despite significant progress in OECD countries in reducing water pollution, improvements in freshwater quality are not always easy to discern. In Norway, 96% of people say they are satisfied with water quality. This figure is much higher than the OECD average of 84% and suggests Norway has been successful in providing good quality water to its inhabitants.
More ResourcesHow's Life? at a Glance OECD Environmental Outlook to 2030
Governance – Norway expand
A cohesive society is one where citizens have a high degree of confidence in their governmental institutions and public administration. In Norway, 68% of people say they trust their political institutions, more than the OECD average of 56%. High voter turnout is another measure of public trust in government and of citizens’ participation in the political process. In the most recent elections for which data is available, voter turnout in Norway was 76% of those registered. This figure is higher than the OECD average of 72%.
Even if the right to vote is universal in all OECD countries, not everyone exercises this right. There is little difference in the voting rates of men and women in most OECD countries. This is the case in Norway, where the voter turnout of men and women is nearly the same. While on average there are few differences between men and women concerning participation in elections, income can have a strong influence on voter turnout. In Norway, voter turnout for the top 20% of the population is an estimated 83%, whereas the participation rate of the bottom 20% is an estimated 70%. This 13 percentage point difference is slightly higher than the OECD average difference of 12 percentage points.
Ensuring that government decision making is not compromised by conflicts of interest is key to maintaining trust in government. Transparency is therefore essential to hold government to account and to maintain confidence in public institutions.
Freedom of information laws (FOI) allow the possibility for individuals to access undisclosed information. For such policies to be successful, the public should have a clear understanding of their rights under the law, should be able to file requests with ease and should be protected against any possible retaliation. People in Norway can file a request for information either in writing, online, by telephone or in person – thus greatly facilitating the FOI process. There are even provisions for anonymity – an important protection that few OECD countries have adopted. There is not yet, however, built-in protection from retaliation.
More ResourcesHow's Life? at a Glance
Health – Norway expand
Most OECD countries have enjoyed large gains in life expectancy over the past decades, thanks to improvements in living conditions, public health interventions and progress in medical care. Life expectancy at birth for the whole population in Norway stands at 81 years, one year above the OECD average of 80 years. Life expectancy for women is 84 years, compared with 79 for men, a slightly smaller gender difference than the average OECD gender gap of six years, with a life expectancy of 83 years for women and 77 years for men.
Higher life expectancy is generally associated with higher healthcare spending per person, although many other factors have an impact on life expectancy (such as living standards, lifestyles, education and environmental factors). Total health spending accounts for 9.4% of GDP in Norway, compared with an average of 9.5% across OECD countries. With 5388 USD per person, Norway ranked the second highest among OECD countries in 2010, well above the OECD average of 3268 USD. Between 2000 and 2009, total health spending in the Norway increased in real terms by 3.7% per year on average, a slower rate than the OECD average of 4.7%. It then decreased by 0.8% in 2010.
Throughout the OECD, tobacco consumption and excessive weight gain remain important risk factors for many chronic diseases. In Norway, the proportion of smokers among adults has been reduced from 36% in 1980 to 19.0%, slightly below the OECD average of 21.1%. Much of this decline can be attributed to policies aimed at reducing tobacco consumption through public awareness campaigns, advertising bans and increased taxation. In many OECD countries, large proportions of the population are overweight or obese. In Norway, the obesity rate among adults – based on self-reported height and weight – is 10.0%, much lower than the OECD average of 17.8%. Obesity’s growing prevalence foreshadows increases in the occurrence of health problems (such as diabetes, cardiovascular diseases and asthma), and higher health care costs in the future.
When asked, “How is your health in general?” 73% of people in Norway reported to be in good health, higher than the OECD average of 69%. Despite the subjective nature of this question, answers have been found to be a good predictor of people’s future health care use. Gender, age and social status may affect answers to this question. On average in OECD countries, men are more likely to report good health than women, with an average of 71% for men and 66% for women. In Norway, the average is 75% for men and 71% for women. Not surprisingly, older people report poorer health, as do those who are unemployed, or who have less education or income. About 85% of the top 20% of the adult population in Norway rate their health as ‘good’ or ‘very good’, compared to about 65% for the bottom 20%.
More ResourcesHow's Life? at a Glance
Life Satisfaction – Norway expand
Happiness or subjective well-being can be measured in terms of life satisfaction, the presence of positive experiences and feelings, and the absence of negative experiences and feelings. Such measures, while subjective, are a useful complement to objective data to compare the quality of life across countries.
Life satisfaction measures how people evaluate their life as a whole rather than their current feelings. It captures a reflective assessment of which life circumstances and conditions are important for subjective well-being. When asked to rate their general satisfaction with life on a scale from 0 to 10, Norwegians gave it a 7.7 grade, one of the highest scores in the OECD, where average life satisfaction is of 6.6.
There is little difference in life satisfaction levels between men and women across OECD countries. This is true in Norway, where men gave their life a 7.6 grade and women 7.7. Education levels strongly influence subjective well-being in many OECD countries but in Norway the difference is relatively small, with people who have only completed primary education reporting a life satisfaction level of 7.5, and people with tertiary education a level of 7.8.
Happiness, or subjective well-being, is also measured by the presence of positive experiences and feelings, and/or the absence of negative experiences and feelings. In Norway, 86% of people reported having more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc) than negative ones (pain, worry, sadness, boredom, etc). This figure is higher than the OECD average of 80%.
Better Policies for Better Lives
High levels of life satisfaction based on strong social cohesion
Norway scores highly in international comparisons of material well-being but also in other fields, such as community, environment and safety, and overall life satisfaction.
These high scores may be related to the Norwegian model of a relatively egalitarian society, where social consensus and a high degree of inclusiveness are important. Not only is wage inequality relatively low in Norway, redistribution through the tax and benefit system is also substantial. The generous provision of public services, such as education and health, also plays a major role in Norwegians’ personal fulfillment and well-being. Recent data shows about 25% of the economy is devoted to producing public goods and services.
Thanks to oil assets, government revenues have exceeded expenditures over the past decade, even during the recent fiscal crisis. Protected from the worst of the crisis by this natural resource and a sound macroeconomic policy framework, Norway continues to enjoy high levels of income and well-being.
More ResourcesHow's Life? at a Glance
Safety – Norway expand
Personal security is a core element for the well-being of individuals, and largely reflects the risks of people being physically assaulted or falling victim to other types of crime. Across the OECD, assault rates have generally declined in the past five years. In Norway, nearly 3.3% of people reported falling victim to assault over the previous 12 months, less than the OECD average of 4.0%. There is a 2 percentage point difference between men and women in assault rates, at respectively 4.3% and 2.3%.
The homicide rate (the number of murders per 100,000 inhabitants) is a more reliable measure of a country’s safety level because, unlike other crimes, murders are usually always reported to the police. According to the latest OECD data, Norway’s homicide rate is 0.6, lower than the OECD average of 2.2 and one of the lowest in the OECD. In Norway, the homicide rate for men is 0.7 compared with 0.5 for women.
Fear of crime is another important indicator as it can constrain behaviour, restrict freedom and threaten the foundation of communities. Despite a general reduction in assault rates in the past five years, in many OECD countries feelings of security have declined. In Norway, 62% of people feel safe walking alone at night, lower than the OECD average of 67%. While men are at a greater risk of being victims of assaults and violent crimes, women report lower feelings of security than men. This has been explained by a greater fear of sexual attacks, the feeling they must also protect their children and their concern that they may be seen as partially responsible.
More ResourcesHow's Life? at a Glance
Work-Life Balance – Norway expand
Finding a suitable balance between work and life is a challenge for all workers, especially working parents. Some couples would like to have (more) children, but do not see how they could afford to stop working. Other parents are happy with the number of children in their family, but would like to work more. This is a challenge to governments because if parents cannot achieve their desired work/life balance, not only is their welfare lowered but so is development in the country.
People spend one-tenth to one-fifth of their time on unpaid work. The distribution of tasks within the family is still influenced by gender roles: men are more likely to spend more hours in paid work, while women spend longer on unpaid domestic work. Men in Norway, spend 152 minutes per day cooking, cleaning or caring, more than the OECD average of 131 minutes but still less than Norwegian women who spend 225 minutes per day on average on domestic work.
Another important aspect of work-life balance is the amount of time a person spends at work. Evidence suggests that long work hours may impair personal health, jeopardize safety and increase stress. People in Norway work 1 426 hours a year, one of the lowest rates in the OECD and much less than the OECD average of 1 776 hours. The share of employees working more than 50 hours per week is not very large across OECD countries. In Norway, some 3% of employees work very long hours, less than the OECD average of 9%. Overall, men spend more hours in paid work: in Norway 4% of men work very long hours, compared with 1% for women.
The more people work, the less time they have to spend on other activities, such as time with others or leisure. The amount and quality of leisure time is important for people’s overall well-being, and can bring additional physical and mental health benefits. People in Norway devote 68% of their day, or 15.6 hours, to personal care (eating, sleeping, etc.) and leisure (socializing with friends and family, hobbies, games, computer and television use, etc.) – more than the OECD average of 14.9 hours. In Norway, both men and women devote approximately 16 hours per day to personal care and leisure.