Migrant Labor in the Norwegian Petroleum Sector

Abstract

Drawing on comprehensive sets of administrative register data, we examine employment and pay structures in the Norwegian petroleum sector between 1992 and 2013, with a particular emphasis on foreign workers. The period covers a number of important changes taking place, with rising oil prices and growing investments during the 2000s and a large influx of labor migrants into Norwegian labor markets following the 2004 expansion of the European Union. Relative to foreign workers in other private‐sector industries, we find that the petroleum sector is characterized by greater use of posted workers, a higher occupational skill mix of immigrants, and, for those in skilled occupations, wages on par with native workers. Migrant petroleum workers have shorter durations in the country than other migrants, and the data reveal only modest job mobility to other industries, particularly among high‐skilled workers. Nonetheless, the evidence points to spillover effects from the petroleum sector as workers who move on to jobs in mainland industries earn a wage premium relative to those without petroleum experience.

Keywords: Norway, migrants, oil, labor markets, wages

JEL Classification: J3, J61