September Sees Slight Uptick in Unemployment Rate Skip to content
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September Sees Slight Uptick in Unemployment Rate

Iceland’s unemployment rate rose from 2.9% in August to 3% in September, according to a new report from the Directorate of Labour. Foreign citizens compose 51% of the unemployed population.

Slight increase from August

In a recent report by the Directorate of Labour, Iceland’s unemployment rate for September was recorded at 3%. This marks an increase from 2.9% in August but is consistent with the figures from May of the same year. For comparison, the rate was slightly higher at 3.2% in September of 2022. The Directorate anticipates that the unemployment rate for October will hover between 2.9% and 3.2%.

The report further details that an average of 5,734 individuals were registered as unemployed in September, comprising 3,175 men and 2,559 women. By the month’s end, the total number of unemployed individuals rose to 6,035.

Unemployment rate highest in Southern Peninsula

Last month, Suðurnes, located on the southernmost side of the Reykjanes peninsula, recorded the highest unemployment rate at 4.2%. This marked an increase from 3.9% in August. Conversely, the Northwestern region of Iceland had the lowest unemployment rate at 0.6%. East Iceland reported an unemployment rate of 1.3%, while West Iceland’s rate stood at 1.7%. In the capital region, the unemployment rate remained steady at 3.3%, unchanged from the previous month.

Over 1,000 out of work for more than a year

As noted by Mbl.is, by the end of September 2023, 1,159 individuals had been unemployed for over 12 months. This figure represents a decrease of 67 from August. For context, in September 2022, the count stood at 2,046, indicating a year-over-year reduction of 887. Additionally, 1,469 individuals had been unemployed for a duration of 6-12 months in September 2023, a slight drop from 1,566 in September 2022.

The report highlights that the tourism sector experienced the most pronounced increase in unemployment compared to the previous month.

Foreign citizens overrepresented

The report also finds that there were 3,056 foreign citizens who were unemployed at the end of September, which is an increase of 160 from August. The proportion of foreign nationals on the unemployment register was about 51% by the end of September.

An assistant professor of economics at Reykjavík University recently maintained that the overrepresentation of foreign citizens in unemployment figures suggested that foreign citizens in Iceland faced additional obstacles when it came to finding work.

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