Hordaland is better prepared for an economic crisis than Rogaland and Agder
“When one oil crisis comes on the heels of another, other industries must be stimulated. Greater innovation capability makes Hordaland more diversified”, says Nina Kyllingstad. She has a doctorate in regional restructuring.
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The world today is characterised by increased globalisation, digitalisation and a focus on sustainability. Kyllingstad's doctoral dissertation is based on the premise that regional restructuring is important in dealing with these challenges.
The term ‘restructuring’ includes the renewal of already existing industries as well as the development of completely new industries. Overall, the dissertation examines regional development from various angles. One of the articles compares the regions of Agder, Rogaland and Hordaland.
Read the full dissertation here.
“Extremely dependent”
“Agder and Rogaland are extremely dependent on the oil sector, so when the oil business goes down, the impacts are felt throughout the regions. However, it does not have to be this way. If you manage to promote innovation across industries, this will help to stimulate the growth of new industries over time”, says Kyllingstad.
For her doctoral thesis, she examined how the industry in Agder, Rogaland and Hordaland works to develop its innovation capability. In one of the articles, representatives from fifteen companies, five from each of the three regions, were interviewed about their attitudes to cross-industry innovation.
Nina Kyllingstad defended her doctoral dissertation in April.
One of the interviewees in Rogaland is quoted in the thesis:
‘This region has become a giant power centre for everything that happens in the oil and gas industry in Norway. It gives us a contact network because all the major and global oil service companies have established offices in our district. Since everything is very focused towards the oil and gas industry, I think people who want to start something outside this industry will have a huge disadvantage, because everything is adapted to one type of industry.’
This has consequences for the priorities in the innovation work. Regions with one dominant industry tend to prioritise innovations unique to that particular industry. This becomes a self-reinforcing process where dominant industries are given priority while alternative industries receive less attention.
Several thousand jobs were lost
The consequences of a favoured and specialised business structure become apparent when things go awry; over 34,000 oil jobs have disappeared since 2014, many of them among subcontractors who have based their entire business on one contract with an oil company.
Where Rogaland and Agder are specialised regions, Hordaland is more diverse in its industrial structure. Many companies in Hordaland are linked to the oil and gas industry, but the interviews with employees in firms in Hordaland show that they have a more interdisciplinary and differentiated focus. The companies employ people with very different skills in order to better adapt to new market situations.
“Not easy”
“Business and industry in Hordaland focus on building innovation across industries. That makes it easier to invest in something new, and the companies benefit from collaboration”, says Kyllingstad.
In Agder and Rogaland, business and industry are less concerned with collaborating across sectors, Kyllingstad's research shows. This leads to the dominant knowledge becoming more specialised, and it is more difficult to promote alternative solutions and to launch completely new ideas in these regions.
“This one-sidedness makes the regions vulnerable. It is not easy to develop something new when what you already have is going well”, says Kyllingstad.