Foreign Citizens Are 23 Percent of Labor Force
Foreign citizens are about 23 percent of the labor force in Iceland, mbl.is reports. Their participation in the labor market has played a huge role in Iceland’s economic growth in recent years, states Hannes G. Sigurðsson, assistant managing director of SA Confederation of Icelandic Enterprise. Their labor participation is very high, that is, 94 percent, compared with 77 percent among Icelandic citizens.
Hannes states that this additional labor is necessary in Iceland. He points out that as the average age of the nation goes up, the rate of increase in the number of working-age Icelanders will go down in coming years and decades.
The number of working-age Icelanders can be expected to go up by 5,000 in the coming decade, which, he notes, is nowhere near enough to meet the supply of future jobs. The number of foreign citizens in Iceland can be expected to continue to rise, he adds.
Assuming an economic growth of 1.5 percent per year in the coming decade, Hannes projects that the number of foreign workers could increase by 14,000 by 2030. Should economic growth be 3 percent on average, however, their numbers could increase by 32,000.
Hannes points out that from 2014 to 2019, immigrants went from being 7 percent of Iceland’s population to being 14 percent. By contrast, during that same period, the ratio of immigrants in Sweden went from 7 to 9 percent of the population. “These figures show that Iceland’s task in the assimilation of immigrants is much larger than that of Sweden,” Hannes states.
He points out the importance of having a clear policy regarding how to protect the Icelandic language, as we adjust to increased diversity in terms of people’s origin. For the past quarters, the rate of unemployment among foreign citizens in Iceland has increased considerably, as economic growth has slowed down. Hannes believes the government must respond by offering job search assistance to families that move here and help them get settled.