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Iceland - National Level

Short overview of the labour market

 

Iceland has a population of 343 960 (1 July 2017) and the population growth was 1.8% in 2016. The Icelandic nation is one of the youngest in Europe, with an average age of around 38 and around 70% of the population being under fifty. The Icelandic labour market is characterised by a high participation rate; over 80% of all able-bodied individuals aged 16-74 participate in the labour market.

The most important sectors in Iceland are service industries such as travel, financial services and health services, miscellaneous industries, agriculture and fishing. The relative importance of these sectors has changed somewhat recently; the significance of service industries, for example, has increased considerably in recent years while fishing and other production industries have declined.

In total, 35% of those in employment work in jobs that require a university education or other specialised knowledge. Office and commercial workers number around 26%, tradesmen 13%, and 12% are unskilled workers. Farmers and fishermen number around 5%. Another characteristic of the Icelandic labour market is the high proportion of trade union membership, at around 85%.

Unemployment numbers have decreased considerably since they reached a peak in 2009 as a result of the economic crisis in the autumn of 2008. In 2016, registered unemployment was on average at 2.3%: 1.9% among men and 2.7% among women. Registered unemployment among young people between the ages of 18-24 was on average 1.8%. Overall, 24% of those who are unemployed are foreign citizens and the majority of them (61%) are Polish. 

According to forecasts, the unemployment rate will fall even more in the near future with an increase in new jobs. It is estimated that about 24 000 foreign nationals are employed in the Icelandic labour market, which is over 11% of the total workforce, and according to forecasts this number will continue to increase. 

Text last edited on: 11/2017


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