Closer scrutiny of the data shows that most of the rise is due to immigration, which aligns well with figures on the number of foreign nationals in the Icelandic labour market. There are currently just over 46,000 foreign workers in Iceland, or around 22% of the labour market. This percentage represents an all-time high, and it can be expected to rise further in the near future, if the need for workers in many of Iceland’s key sectors is any indication. In fact, the outlook is for significant growth in sectors such as construction, where staffing problems have been perhaps greatest. According to SI, there are nearly 1,500 vacancies in the sector, or 8% of all construction industry jobs.
Executives from Iceland’s largest companies appear to agree that there is a driving need for workers. According to Gallup’s December 2022 survey among Iceland’s 400 largest firms, 53% of company executives consider themselves short-staffed, a sizeable percentage in historical terms, although it has fallen since last autumn. Staffing woes are most pronounced in the construction sector, where 78% of executives say need workers, followed by retail and wholesale trade (63%). Worker shortages in tourism tend to fluctuate more: 29% of firms reported being understaffed in December, but this figure can be expected to rise again as the peak season draws closer. Job numbers therefore look set to increase further in the coming term, and a large share of the newly created positions will probably be filled by foreign workers.