On average, there were 226,900 people in the Icelandic labour market in the year 2023. Of those, around 219,300 were employed and around 7,600 unemployed and looking for a job. The activity rate was 80.5%, the employment rate 77.8% and the unemployment rate 3.4%. The number of unemployed decreased by just over 500 persons from 2022 and the unemployment rate decreased by 0.4 percentage points between years. Unemployment rate among women was 2.9% on average and among men it was 3.8%. In 2023 the unemployment rate was on average 4.6% in Reykjavik, 3.0% in the vicinity of Reykjavík and 2.3% outside the Capital region.
According to the Icelandic Labour Force Survey (IS-LFS) it is estimated that there were 100,100 women and 119,200 men employed on average in 2023. Analysis of non-binary individuals is not possible with the data collected in the IS-LFS but 72 non-binary individuals, according to registration, were employed on average in 2023 according to register-based data.
In 2023, the total hours worked in the reference week were on average 36.4 hours per week. The total working hours for women were 32.5 on average and 39.6 for men. People in other regions worked on average more hours per week than those living in the Capital region. The average working hours for people in Reykjavik in 2023 were 35.2 hours, the average was 35.8 hours for people living in the vicinity of Reykjavík and 38.2 hours for people outside the Capital region.
Interesting trends can be seen when looking at the development of the level of education of employed persons over the period of 2003 to 2023. Employed people with university degree has increased from 24.2% in 2003 to 40.8% in 2023. At the same time, the percentage of those who have only completed primary or lower secondary education has decreased significantly and the share of those who have completed upper secondary or post-secondary non-tertiary education has remained the same.
Immigrants as a group are rather difficult to cover with data from the IS-LFS. Their response rate has been very low for a long time and the results is a significant underestimation of their number in weighted numbers. At the same time the response rate for immigrants has decreased, their percentage of the population has increased significantly. Other source was therefore used to show their number in the Icelandic labour market. It was done by looking at data from Pay as You Earn for persons aged between 16 and 74 years with legal residence in Iceland. It was done for the entire period from 2003 to 2023. According to that analysis, the percentage of working immigrants in the Icelandic labour market has more than quadrupled from 2003 to 2023, from 5.1% of all in employment to 23.0%.