Iceland : Job market

What are my chances of getting a job?

Iceland was hit particularly hard by the global economic crisis and the unemployment level rose drastically during the period 2008-09 as a result. In October 2008 the Icelandic government took control of all three of the country’s major banks and the country remains in the process of stabilising its currency and repairing its severely damaged financial sector. Until the situation has improved, job opportunities will be limited.

EURES - The European Job Mobility Portal reports that the number of foreign workers in Iceland has dropped from around 17,000 in 2008 to approximately 7,000-8,000 in 2010. Furthermore, it predicts that it is likely half this figure will seek new opportunities outside of Iceland.

The Icelandic Government Information Centre asserts, however, that: the foundation of Iceland’s economy remains strong despite the current economic crisis. Iceland’s clean energy, its marine resources, strong infrastructure and well-educated workforce, provide a firm basis to overcome the current economic difficulties and implement needed reforms'.

• Typical problems encountered: Iceland has a well-educated population and British graduates will need to compete with skilled workers.
• How to improve your chances: skilled workers earn higher wages so if applicable it can be worth spending a few years after graduation building up relevant skills before you move to Iceland.
• Language requirements: it is essential you have a good grasp of the Icelandic language if you are going to seriously compete for employment and opportunities.

Where can I work?

• Major industries: fish processing, ferrosilicon production, geothermal power, hydropower, tourism.
• Recent growth areas: new developments in software production, biotechnology, and tourism.
• Industries in decline: construction, and to a lesser degree, fishing.
• Major companies: SIF Ltd, Actavis, Ossur, Alcan, Frisk Software International, Icelandair Group, Marel, Nýherji, Orkuveita Reykjavíkur. The three largest banks Kaupthing, Landsbanki and Glitnir are now owned by the government.
• Search for more companies: Iceland Chambers of Commerce, Gula linan (Icelandic Yellow Pages).
• Major cities: Reykjavik (capital and largest), Kopavogur, Hafnarfjordur, Akureyri.

What’s it like working in Iceland?

• Average working hours: 40 per week. Icelanders tend to work hard and sometimes long hours to maintain their high living standards. Working overtime is common but employers do pay workers for any overtime they do.
• Holidays: Minimum of 24 days leave plus 13 public holidays. Usually 5 weeks per year.
• Tax rates: The flat-rate personal income tax has been replaced with a three-tier tax system. The following rates now apply: on earnings less than ISK200,000 per month: 24.1% tax is deducted, between ISK200,001 and ISK650,000: 27% and on salaries above ISK650,001: 33%. A municipal tax of 13.12% is also deducted at source. Personal allowance is granted in the amount of ISK 44.205 per month, which makes an annual income of ISK 1,484,580 (USD 11,886) tax-free (Invest in Iceland Agency: Doing Business in Iceland, May 2010).
• Working practices and customs: Honesty, straight-talking and punctuality are all highly valued in Iceland. Understanding Icelandic names is also important for business interaction. Only a small proportion of the population have original surnames so telephone directories list individuals alphabetically by their first names. Surnames are based on the father's Christian name plus 'son' or 'daughter'. It is common for Icelanders to refer to each other by their first name in business situations. For further advice on business etiquette see Kwintessential.