FX.co ★ Iceland Unemployment Rate Falls to 4.5% in December

In December 2025, Iceland witnessed a significant drop in its seasonally adjusted unemployment rate, which fell to 4.5% from November's 6.9%. Despite the typical seasonal decline in December, the rate stayed above the 3.9% recorded in the same month the previous year. The number of unemployed individuals reduced by 5,900, totaling 10,500. Both male and female unemployment rates saw decreases; men's unemployment fell to 4.5% from 6.1%, while women's unemployment dropped markedly to 4.4% from 7.7%. Furthermore, unemployment among the youth, covering job-seekers aged 14 to 26, improved, dropping to 10.8% from 13.5% in November. The employment rate increased to 76.9% from 75.6%, with the employed population rising by 1,600 to 223,400 individuals. However, the labor force participation rate experienced a decline, moving down to 80.5% from 81.2%. Without seasonal adjustments, the unemployment rate also demonstrated significant improvement, decreasing to 4.2% in December from 6.5% in the prior month.