Iceland’s seasonally adjusted unemployment rate fell to 3.1% in May 2025, down 0.2 percentage points from the previous month, according to Statistics Iceland.
Slight, month-over-month decrease
Iceland’s seasonally adjusted unemployment rate* stood at 3.1% in May 2025, according to new figures from Statistics Iceland’s Labour Force Survey. This marks a slight month-over-month decrease of 0.2 percentage points.
The employment rate (the proportion of the working-age population currently employed) was 78.6%, while labour force participation (the share of people either working or actively seeking work) measured 81.1%.
In raw, unadjusted terms, approximately 10,700 individuals aged 16 to 74 were unemployed in May. This corresponds to an observed (non-adjusted) unemployment rate of 4.5%. The measured labour force participation rate was 82.3%, and the employment rate matched the adjusted figure at 78.6%.
*The seasonally adjusted figures are used to account for predictable fluctuations in employment related to seasonal patterns, such as summer jobs or temporary holiday closures, offering a clearer view of underlying trends in the labour market.
