Unemployment Rate in Iceland Climbs to Nine Percent Skip to content

Unemployment Rate in Iceland Climbs to Nine Percent

The unemployment rate keeps increasing in Iceland, rising to nine percent in January compared to 8.1 percent the month prior. At the end of January 16,382 people were registered as unemployed at the Directorate of Labor and that number is expected to increase further this month.

The construction site of an aluminum smelter in east Iceland. Many construction workers are now unemployed. Copyright: Icelandic Photo Agency.

In January 2009, the unemployment rate was 6.6 percent. The rate is now rapidly approaching the peak of April last year, 9.1 percent. The directorate is expecting an unemployment rate of up to 9.3 percent in February 2010, compared to 8.2 percent last year, Morgunbladid reports.

Meanwhile, Capacent is predicting 6,500 new jobs will be created in the Sudurnes region in southwest Iceland—which is among those hardest hit by unemployment—until 2013 due to large-scale industrial projects that are being planned in the area, Fréttabladid reports.

Capacent will present its report to the council of the Reykjanesbaer municipality today. The report assumes that local tax income in 2010 will increase by ISK 680 million (USD 5.3 million, EUR 3.9 million), by ISK 1.7 billion (USD 13 million, EUR 7 million) in 2011 and ISK 4.3 billion (USD 33 million, EUR 24 million) until 2013.

The new jobs and increase in revenue are expected because of the planned aluminum smelter in Helguvík, a silicone factory, HS Energy’s power plants, various projects at the Keflavík International Airport and Verne Holding’s data center.

Click here to read more about Sudurnes and here to read more about unemployment in Iceland.

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