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Iceland's new labour market policy focuses on young men

Iceland's new labour market policy focuses on young men

| Text: Guðrún Helga Sigurðardóttir

Iceland is developing a labour market policy for the period leading up to 2020, the first such policy the country has ever had. There are more people with low education in Iceland than elsewhere in Europe. Experts say the most important thing now is to develop a strategy for educating young men.

Two years ago Iceland’s government established a working group which had two tasks; to fight unemployment and to design a comprehensive labour market policy for Iceland. The report on the labour market policy is expected at the end of 2012. Yet it is already clear that more resources must be put into education, and especially vocational education for young men. 

Iceland’s labour force can be divided into three equally sized groups; people with university degrees, people with higher secondary education and people who only have an elementary school education. 32 to 33 percent of Icelanders only attended elementary school. That means people with low education make up a far larger group in Iceland compared to elsewhere in Europe. 

Iceland 1“We also see that now, when the crisis is almost over, people in this group still can’t find work because employers demand an education,” says Runólfur Ágústsson, chairman for Iceland’s Directorate of Labour -  Vinnumálastofnun - Iceland’s version of Sweden’s Public Employment Service and Norway’s Labour and Welfare service.

Iceland has always had many people with low education. Young Icelanders have left school early to a greater extent than young people elsewhere in Europe. Early school leavers represent a large problem and something must be done to get the youths to finish their studies within a reasonable time. 

Fishing industry used to pick them up

Head master Valgerður Gunnarsdóttir is the chair of Iceland’s head teacher association (Skólameistarafélags Íslands). Gunnarsdóttir is worried about young Icelandic men. Despite the fact that 95 to 98 percent of Icelandic youths start their upper secondary education after elementary school, boys leave early.

Gunnarsdóttir says boys used to leave school to go and work in the fisheries industry. But that opportunity is no longer there. Gunnarsdóttir thinks the root of the problem is that many of the youths are unprepared for the type of studying they have to do when they start upper secondary education. 

“They need a lot of help to carry out their studies,” she says. 

“We have no surveys to show how they have got this far without getting the help they need,” she continues.

“When young people can’t manage their upper secondary studies, they disappear out of the schools,” she says.

Go for education

Gunnarsdóttir thinks the most important thing is to make Icelanders aware that upper secondary schools need more money to help the large number of students who join every year.

“Many need so much help that we don’t have enough staff and not enough resources,” she says.

Gunnarsdóttir thinks there is a need to strengthen vocational education in Iceland in order to offer young Icelandic men - with all their energy and need to work - the chance to train and become good skilled workers. She says this is something which could be done in cooperation with industry. 

The goal

Half of all unemployed people in Iceland have low education. Right now the unemployment figure stands at seven percent, but for people with a university education it is around three percent. Ágústsson also thinks the Icelandic labour market policy should focus on further education for people with low education. The goal is to reduce the number of people with low education to 10 percent in the future.

“It will be costly to invest heavily in further education, but it is important to decide on which measures we need to go for and to agree on the timing of it all,” says Ágústsson.

“The policy is the most important thing. When it is ready we get going,” he explains. The labour market policy should be ready by the end of 2012, along with the time table and details for how the project will be financed. 


Iceland’s Ministry of Welfare, parliamentarians from all political parties and the social partners have been backing the education project ‘Nám er vinnandi vegur’ (Learning is the way to go) over the past two years, where job seekers are given the chance to study. 

Resources have been transferred from unemployment funds to the education system - seven billion Icelandic kronor (€42m) over a three year period. This means Atvinnuleysistryggingasjóður, Iceland’s unemployment insurance fund, is financing study places for 1,000 unemployed Icelanders. 

Rather than covering unemployment benefits, the resources are being used to create new jobs for the unemployed. Unemployment has fallen by 1 to 2 percent according to Ágústsson.

Future worries include immigration, people living in areas traditionally most exposed to unemployment, long-term unemployment and young men who leave school early.


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