Although the situation on the Icelandic labor market is good in most parts of the country where companies and institutions still lack employees and few receive unemployment benefits, the Directorate of Labor fears the situation will change next fall.
The situation in the fish processing sector is becoming serious where more than 500 workers are expected to lose their jobs. Over 250 are already unemployed.
The Directorate of Labor predicts unemployment rates in Iceland will rise slightly to 0.8 or 1.1 percent this January. Both the Confederation of Icelandic Employers (SA) and the Icelandic Confederation of Labor (ASÍ) agree that the unemployment situation will worsen next fall, Morgunbladid reports.
Only 835 are registered unemployed in the capital region at the moment, fewer than last year. On average, 1,632 people were unemployed in Iceland in 2007.
Hugrún Jóhannesdóttir, director of the local employment agency, said although people are losing their jobs outside the capital region, the situation is still good in Reykjavík and neighboring towns.
It is, however, evident that the expansion and demand for labor is slowing down, Jóhannesdóttir said, and currently many more foreign laborers are registered at the agency than ever before.