Iceland’s seasonally adjusted unemployment rate fell to 5.7% in September 2026, according to figures published by Statistics Iceland (Hagstofa Íslands) on Wednesday. The agency, which conducts official statistical monitoring in Iceland, reported that unemployment dropped by 1.1 percentage points compared with August, though rates remain higher than last year. Viðskiptablaðið was first to report the latest data.
The number of unemployed people aged 16 to 74 in Iceland stood at 15,300 last month, based on seasonally adjusted figures. In August 2026, the unemployment rate was 6.8%. The share of people in work also increased by 1.2 percentage points from August to September, raising the total employment rate to 75.0%.
Labour force participation, a measure of people who are working or actively seeking work, rose to 79.6% on a seasonally adjusted basis. This marks an increase of 0.4 percentage points from the previous month, Statistics Iceland said.
However, raw survey figures for September show unemployment at 5.1%, or about 11,900 individuals, and a labour force participation rate of 79.7%. Employment stood at 75.6%, or around 222,800 people, according to the official survey. Compared with September 2025, unadjusted unemployment increased by 1.9 percentage points, while both the employment rate and labour force participation fell, by 3.0 and 1.4 percentage points respectively. Unadjusted unemployment in September 2026 was also higher than the same month last year, mbl.is reported.
Youth unemployment and background
Unemployment among 16- to 24-year-olds remained high in the second quarter of 2026, at 17.3%. This was up by 9.7 percentage points year-on-year, rising from 7.6% in the second quarter of 2025, according to mbl.is.
Statistics Iceland, the country’s main provider of official statistics and census data, was established by the Icelandic parliament in 1913 and began operations in 1914. Since 2008, it has operated as an independent government agency under the Prime Minister’s Office.
Sources
Links: niðurstöðum
- Hagstofa Íslands (Statistics Iceland) in Icelandic
- Viðskiptablaðið (first reported) in Icelandic
- mbl.is in Icelandic
- Vísir in Icelandic
- Vísir in Icelandic
- mbl.is in Icelandic
