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Employment Policy Convention, 1964 (No. 122) - Iceland (RATIFICATION: 1990)

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The Committee notes that the Government’s report has not been received. It hopes that the next report will contain full information on the matters raised in its previous comments.

Repetition
COVID-19 pandemic. Response and recovery measures. The Committee notes the extensive response measures taken by the Government to mitigate the effects of the COVID-19 pandemic. The broad-based measures are intended primarily to prevent unemployment and temporary loss of personal income through a Government payment of up to 75 per cent of the salary of part-time workers to encourage businesses to keep employees and avoid job losses. The measures also provide for the possibility of postponing the payment of taxes for businesses experiencing temporary difficulties as well as the possibility of withdrawing a monthly sum from voluntary pension savings. The Committee further notes the conclusion on 5 March 2020 of a three-party agreement on action to counter COVID-19 between the Government, the SA Confederation of Icelandic Enterprise, and the Icelandic Confederation of Labour. The parties agreed to recommend that: enterprises continue paying wages to those employees who have been quarantined by the health authorities and that workers’ organizations will ensure that persons with membership in their sick leave funds who fall ill receive full payment from the fund if their sick leave entitlements through employment have been exhausted. In addition, the agreement contemplates the adoption of measures to introduce amendments to the Health Insurance Act in order to allow businesses paying the salaries of employees who have been quarantined to claim reimbursement of these costs from the Icelandic Health Insurance Fund up to a specified limit and under certain circumstances. In this context, the Committee recalls the comprehensive guidance provided by international labour standards and draws the Government’s attention to the Employment and Decent Work for Peace and Resilience Recommendation, 2017 (No. 205), which provides guidelines for developing and implementing effective, consensus-based and inclusive responses to the profound socio-economic impacts of the pandemic. The Committee invites the Government to provide updated information in its next report on the impacts of the global COVID-19 pandemic on the application of the Convention and the nature and outcomes of measures taken to mitigate these impacts.
Articles 1 and 2 of the Convention. Employment trends and active labour market measures. The Committee welcomes the Government’s report, prepared in consultation with the Icelandic Tripartite ILO Committee, which contains updated statistical information, indicating that the employment situation continued to improve during the reporting period. According to Statistics Iceland, the overall employment rate in 2018 was 81.6 per cent. The overall unemployment rate was 3.3 per cent in 2018, although it began to rise again in 2019. The Government indicates that one of its policy priorities is promoting a diversified economy that is prepared for the challenges and opportunities brought by the rapid evolution of technology. The Government envisages the establishment of a National Fund to manage the profits generated by the country’s natural resources, including energy resources that will be used to promote technological innovation and support the growth and development of start-up companies to create new, well-paid jobs in the future. Moreover, the Government indicates that the Directorate of Labour provides counselling services to jobseekers, vocational training and workshops. The Directorate also provides special grants to support women-led businesses and for the payment of educational fees. The Government indicates that one of the key objectives of the labour market measures implemented is to get long-term unemployed people into work. The main measures entail providing additional vocational and employment-related remedies for long-term unemployed persons in collaboration with the business sector and educational institutions based on needs analyses of the job market. The Government also refers to the launching in 2018 of a regional development policy for the period 2018-24, whose principal objectives include addressing the population decline in certain regions, resolving issues arising from over-dependence on a narrow range of occupational sectors, as well as meeting the challenges posed by technological changes. The Committee further notes the statistical information provided by the Government concerning the persons registered to participate in employment-related measures. The Government reports that between 2015 and 2018, approximately 83 per cent of those who participated in active labour market measures were no longer registered as unemployed three months after the completion of the programmes. The Committee requests the Government to continue to provide information, including statistics, disaggregated by age and sex, on the impact of the active labour market measures taken to promote employment through the implementation of a coordinated employment policy and programmes. It also requests the Government to continue to provide information on the nature and the impact of the employment measures taken or envisaged targeting the long-term unemployed as well as the other specific target groups identified by the Government.
Youth employment. The Government reports that it is placing priority on developing and extending services for young persons in vulnerable situations, reducing the number of young unemployed persons remaining on the unemployment register for longer than 6 months and the number of jobseekers aged 18–29 who remain on the register for more than 12 months. These efforts seek to prevent youth from dropping out of the labour market or other forms of activity and to improve their employability. The Directorate of Labour has adopted an interdisciplinary approach which promotes the relation between the social, employment and health services and the school system. It launched an experimental project for the period 2017 to 2020 to improve the situation of young persons aged 16 to 29 who have not completed any formal education after completion of compulsory schooling and who are considered at risk of becoming chronically inactive in the labour market. In addition, the “Job forum” (Atvinnutorg) project, launched at the end of 2017, provides individual counselling services to jobseekers, and benefited a significant number of young persons. The Government reports that recent university graduates represent a high proportion of the unemployed (32 per cent among women and 20 per cent among men in the first half of 2019). The Directorate of Labour has adopted special measures to reduce unemployment among these young graduates, collaborating with institutions holding courses and workshops for the unemployed and promoting the creation of more employment opportunities for young graduates, in collaboration with enterprises and institutions. The Committee requests the Government to continue to provide detailed information on the nature and extent of measures taken or envisaged to tackle youth unemployment, especially among recent university graduates, as well as information, including statistical data disaggregated by age and sex, on the impact of the measures on young persons’ access to lasting employment.
Workers in vulnerable situations. In reply to its previous comments, the Committee notes the information provided by the Government concerning the measures adopted with a view to ensuring that persons with disabilities are not discriminated on the job market and to developing supportive remedies. In this regard, the Government recalls that the Directorate of Labour provides specialized counselling for jobseekers, assisting individuals and monitoring their progress in the workplace through the “Employment with Support” (AMS) project. The Government also refers to the implementation by the Directorate of Labour of a one-year project in 2016 through a grant from the Ministry of Social Affairs, aimed at expanding employment opportunities for persons with disabilities who were about to complete their formal education at school or at the University. The Government indicates that, in view of the positive results achieved by the project, the Directorate of Labour plans to further develop the project to enhance the understanding of the importance of ensuring equal opportunities for persons with disabilities in the labour market. The Committee notes, however, that the Government has not provided information on the specific measures adopted or envisaged to promote employment for persons with mental or psychiatric disabilities. The Committee requests the Government to continue to provide detailed updated information on the nature and impact of the measures adopted to promote the access to the labour market for persons with disabilities and other jobseekers with diminished working capacity, including information on measures to promote employment for persons with mental or intellectual disabilities.
Recruitment of foreign workers. The Committee notes the information provided by the Government concerning the expansion of employment support measures to address the high unemployment rates among foreign workers, which according to the Government have continued to increase in the period 2017–19. The Government refers in particular to the expansion of language-interpreting services and language courses, and to an increase in the number of vocational training opportunities open to foreign jobseekers in order to enhance their employability and give them more opportunities to learn Icelandic. The Committee requests the Government to continue to provide updated detailed information on the nature and the impact of the measures taken to support the access of foreign workers to the Icelandic labour market and reduce unemployment among this particular category of workers.
Business development. In reply to its previous comments, the Committee notes the information provided by the Government regarding the impact of business development measures on employment creation and decent work. The Government indicates that, according to a survey conducted in 2017, 75 per cent of enterprises that received a grant between 2011 and 2016 under the Women’s Employment scheme were still in business. The Government adds that in 2019, 29 projects received grants under the scheme, totalling ISK40 million. Moreover, the Government indicates that the Credit Guarantee Fund ceased its operations in 2018. According to a survey carried out among its beneficiaries, loans and guarantees made by the Credit Guarantee Fund had played a crucial role in the running of the respondents’ enterprises, which increased their turnover volume and number of employees. The Government adds, however, that in view of the low response rate in the survey, it is difficult to base definite conclusions on these findings. The Committee notes, however, that the Government does not provide information on the status of the review of the regulatory framework of the business sector. The Committee requests the Government to continue to provide information, including disaggregated statistics on the impact of the measures taken with the aim of ensuring an enabling business environment conducive to job creation and decent work. The Committee reiterates its request that the Government provide information on the status of the review of the regulatory framework of the business sector in Iceland.

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COVID-19 pandemic. Response and recovery measures. The Committee notes the extensive response measures taken by the Government to mitigate the effects of the COVID-19 pandemic. The broad-based measures are intended primarily to prevent unemployment and temporary loss of personal income through a Government payment of up to 75 per cent of the salary of part-time workers to encourage businesses to keep employees and avoid job losses. The measures also provide for the possibility of postponing the payment of taxes for businesses experiencing temporary difficulties as well as the possibility of withdrawing a monthly sum from voluntary pension savings. The Committee further notes the conclusion on 5 March 2020 of a three-party agreement on action to counter COVID-19 between the Government, the SA Confederation of Icelandic Enterprise, and the Icelandic Confederation of Labour. The parties agreed to recommend that: enterprises continue paying wages to those employees who have been quarantined by the health authorities and that workers’ organizations will ensure that persons with membership in their sick leave funds who fall ill receive full payment from the fund if their sick leave entitlements through employment have been exhausted. In addition, the agreement contemplates the adoption of measures to introduce amendments to the Health Insurance Act in order to allow businesses paying the salaries of employees who have been quarantined to claim reimbursement of these costs from the Icelandic Health Insurance Fund up to a specified limit and under certain circumstances. In this context, the Committee recalls the comprehensive guidance provided by international labour standards and draws the Government’s attention to the Employment and Decent Work for Peace and Resilience Recommendation, 2017 (No. 205), which provides guidelines for developing and implementing effective, consensus-based and inclusive responses to the profound socio-economic impacts of the pandemic. The Committee invites the Government to provide updated information in its next report on the impacts of the global COVID-19 pandemic on the application of the Convention and the nature and outcomes of measures taken to mitigate these impacts.

Articles 1 and 2 of the Convention. Employment trends and active labour market measures. The Committee welcomes the Government’s report, prepared in consultation with the Icelandic Tripartite ILO Committee, which contains updated statistical information, indicating that the employment situation continued to improve during the reporting period. According to Statistics Iceland, the overall employment rate in 2018 was 81.6 per cent. The overall unemployment rate was 3.3 per cent in 2018, although it began to rise again in 2019. The Government indicates that one of its policy priorities is promoting a diversified economy that is prepared for the challenges and opportunities brought by the rapid evolution of technology. The Government envisages the establishment of a National Fund to manage the profits generated by the country’s natural resources, including energy resources that will be used to promote technological innovation and support the growth and development of start-up companies to create new, well-paid jobs in the future. Moreover, the Government indicates that the Directorate of Labour provides counselling services to jobseekers, vocational training and workshops. The Directorate also provides special grants to support women-led businesses and for the payment of educational fees. The Government indicates that one of the key objectives of the labour market measures implemented is to get long-term unemployed people into work. The main measures entail providing additional vocational and employment-related remedies for long-term unemployed persons in collaboration with the business sector and educational institutions based on needs analyses of the job market. The Government also refers to the launching in 2018 of a regional development policy for the period 2018-24, whose principal objectives include addressing the population decline in certain regions, resolving issues arising from over-dependence on a narrow range of occupational sectors, as well as meeting the challenges posed by technological changes. The Committee further notes the statistical information provided by the Government concerning the persons registered to participate in employment-related measures. The Government reports that between 2015 and 2018, approximately 83 per cent of those who participated in active labour market measures were no longer registered as unemployed three months after the completion of the programmes. The Committee requests the Government to continue to provide information, including statistics, disaggregated by age and sex, on the impact of the active labour market measures taken to promote employment through the implementation of a coordinated employment policy and programmes. It also requests the Government to continue to provide information on the nature and the impact of the employment measures taken or envisaged targeting the long-term unemployed as well as the other specific target groups identified by the Government.

Youth employment. The Government reports that it is placing priority on developing and extending services for young persons in vulnerable situations, reducing the number of young unemployed persons remaining on the unemployment register for longer than 6 months and the number of job-seekers aged 18-29 who remain on the register for more than 12 months. These efforts seek to prevent youth from dropping out of the labour market or other forms of activity and to improve their employability. The Directorate of Labour has adopted an interdisciplinary approach which promotes the relation between the social, employment and health services and the school system. It launched an experimental project for the period 2017 to 2020 to improve the situation of young persons aged 16 to 29 who have not completed any formal education after completion of compulsory schooling and who are considered at risk of becoming chronically inactive in the labour market. In addition, the “Job forum” (Atvinnutorg) project, launched at the end of 2017, provides individual counselling services to job-seekers, and benefitted a significant number of young persons. The Government reports that recent university graduates represent a high proportion of the unemployed (32 per cent among women and 20 per cent among men in the first half of 2019). The Directorate of Labour has adopted special measures to reduce unemployment among these young graduates, collaborating with institutions holding courses and workshops for the unemployed and promoting the creation of more employment opportunities for young graduates, in collaboration with enterprises and institutions. The Committee requests the Government to continue to provide detailed information on the nature and extent of measures taken or envisaged to tackle youth unemployment, especially among recent university graduates, as well as information, including statistical data disaggregated by age and sex, on the impact of the measures on young persons’ access to lasting employment.

Workers in vulnerable situations. In reply to its previous comments, the Committee notes the information provided by the Government concerning the measures adopted with a view to ensuring that persons with disabilities are not discriminated on the job market and to developing supportive remedies. In this regard, the Government recalls that the Directorate of Labour provides specialized counselling for jobseekers, assisting individuals and monitoring their progress in the workplace through the “Employment with Support” (AMS) project. The Government also refers to the implementation by the Directorate of Labour of a one-year project in 2016 through a grant from the Ministry of Social Affairs, aimed at expanding employment opportunities for persons with disabilities who were about to complete their formal education at school or at the University. The Government indicates that, in view of the positive results achieved by the project, the Directorate of Labour plans to further develop the project to enhance the understanding of the importance of ensuring equal opportunities for persons with disabilities in the labour market. The Committee notes, however, that the Government has not provided information on the specific measures adopted or envisaged to promote employment for persons with mental or psychiatric disabilities. The Committee requests the Government to continue to provide detailed updated information on the nature and impact of the measures adopted to promote the access to the labour market for persons with disabilities and other jobseekers with diminished working capacity, including information on measures to promote employment for persons with mental or intellectual disabilities.

Recruitment of foreign workers. The Committee notes the information provided by the Government concerning the expansion of employment support measures to address the high unemployment rates among foreign workers, which according to the Government have continued to increase in the period 2017-2019. The Government refers in particular to the expansion of language-interpreting services and language courses, and to an increase in the number of vocational training opportunities open to foreign jobseekers in order to enhance their employability and give them more opportunities to learn Icelandic. The Committee requests the Government to continue to provide updated detailed information on the nature and the impact of the measures taken to support the access of foreign workers to the Icelandic labour market and reduce unemployment among this particular category of workers.

Business development. In reply to its previous comments, the Committee notes the information provided by the Government regarding the impact of business development measures on employment creation and decent work. The Government indicates that, according to a survey conducted in 2017, 75 per cent of enterprises that received a grant between 2011 and 2016 under the Women’s Employment scheme were still in business. The Government adds that in 2019, 29 projects received grants under the scheme, totalling ISK40 million. Moreover, the Government indicates that the Credit Guarantee Fund ceased its operations in 2018. According to a survey carried out among its beneficiaries, loans and guarantees made by the Credit Guarantee Fund had played a crucial role in the running of the respondents’ enterprises, which increased their turnover volume and number of employees. The Government adds, however, that in view of the low response rate in the survey, it is difficult to base definite conclusions on these findings. The Committee notes, however, that the Government does not provide information on the status of the review of the regulatory framework of the business sector. The Committee requests the Government to continue to provide information, including disaggregated statistics on the impact of the measures taken with the aim of ensuring an enabling business environment conducive to job creation and decent work. The Committee reiterates its request that the Government provide information on the status of the review of the regulatory framework of the business sector in Iceland.

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Articles 1 and 2 of the Convention. Employment trends and active labour market measures. In its previous comments, the Committee requested the Government to provide information on the impact of the measures taken to generate employment through the implementation of an active employment policy, including measures targeting the long-term unemployed. The Committee welcomes the statistical information provided by the Government, indicating that the employment situation improved during the reporting period. According to labour market surveys conducted by Statistics Iceland, the employment rate rose from 81.4 per cent in 2013 to 82.5 per cent in 2015, while the average annualized unemployment rate decreased from 5.4 per cent to 4.0 during the same period. The Committee also notes that the operational plans of the Directorate of Labour for the reporting period paid special attention to disadvantaged groups, providing them with individually tailored services to assist them in accessing employment: jobseekers of foreign origin; unemployed women; young university graduates in search of work; long-term unemployed persons; and jobseekers who were not entitled to unemployment benefit. The Government indicates that there were about 23,300 persons registered in all labour market measures during the aforementioned period and that 85 per cent of those who participated in these measures were no longer on the unemployment register three months after completing their projects. Moreover, long-term unemployment fell from 28 per cent of all persons registered as unemployed to 22 per cent from 2013 to 2015. The Government attributes this trend to the amendments to the Unemployment Insurance Act which, as of 1 January 2015, reduced the unemployment benefit entitlement period from 36 to 30 months; to the improved labour market; and to the success of measures taken to provide the long-term unemployed with better services. The Committee requests the Government to continue to provide information, including statistics, disaggregated by age and sex, on the impact of the active labour market measures taken to promote employment through the implementation of an employment policy and programmes. It also requests the Government to continue to provide information on the employment measures targeting the long-term unemployed as well as the other target groups identified by the Government.

Youth employment. In reply to the Committee’s previous comments, the Government indicates that youth unemployment (persons aged 16–24) remains higher than among older people (55 and over), standing at 10.6 per cent in 2013, 9.9 per cent in 2014, and 11 per cent in the first half of 2015. A project to provide integrated counselling for young people was launched in 2013 by the Directorate of Labour in collaboration with local authorities and the secondary schools. It focuses on people aged 16–25 that are unemployed or have dropped out of school. In addition, at the beginning of 2015, the Directorate of Labour and the Welfare Department of Reykjavík City signed a collaborative agreement to provide counselling, vocational training and other remedial measures to young jobseekers who receive financial assistance from the city. The Government indicates that municipalities and state bodies also provide summer jobs for students, although as the need for these measures has declined with falling unemployment, the number of jobs offered has also dropped, from 650 summer jobs on offer in 2013 to 365 in 2015. The Committee requests the Government to continue to provide information on the measures taken or envisaged to tackle youth unemployment, as well as information, including statistical data, on the impact of measures implemented.

Vulnerable categories of workers. The Government indicates that the Directorate of Labour provides counselling, assistance with employment searches, support and follow-up measures in the workplace to persons with disabilities and other jobseekers with diminished working capacity through the “Employment with Support” (AMS) project. There were 962 persons covered by the AMS scheme in the period 2013–15 and 308 persons with reduced working capacity received counselling services from the Directorate of Labour between 2013 and 2014. Furthermore, the Harnessing Abilities–All Abilities collaborative project was launched in 2015. This project is run by the Directorate of Labour, the Organization of the Disabled in Iceland together with the National Association of People with Intellectual Disabilities. By taking part in it, public institutions and local authorities can engage individuals with reduced working capacity and receive a reimbursement of part of the wages and wage-related payments in respect of the worker, who may also receive support from counsellors at the Directorate of Labour. In September 2015, 62 positions had been created under the project, engaging 48 participants. The Government also refers to the VIRK Rehabilitation Fund, a private institution owned by all the main workers’ and employers’ organizations. The Fund provides services to build up the working capacity of people who have not been able to work due to health-related issues through vocational rehabilitation programmes. During the reporting 76 per cent of the 3,311 persons that completed the VIRK’s vocational rehabilitation programmes became active in the labour market (in employment, seeking employment or in a course of study which qualified for student loans). The Committee also notes the information provided by the Government on a collaborative project between the VIRK and the Psychiatric Department of Landspítali to develop a vocational rehabilitation scheme to enable young persons with psychiatric diagnoses to find suitable work. The Committee requests the Government to provide information on the impact of the measures adopted to promote the access to the labour market for persons with disabilities and other jobseekers with diminished working capacity, including information on measures to promote employment for persons with mental or psychiatric disabilities.

Business development. In its previous comments, the Committee requested the Government to provide information on the impact of business development measures on employment creation and decent work. It notes the information provided by the Government concerning the project “Develop Your Own Commercial Idea”, and the Women’s Credit Guarantee Fund, including the total number of loan guarantees granted in 2014 and 2015. The Committee also notes the Government’s policy statement of 2013 indicating that it intends to strive to create a working environment that will promote investment and job-creation, focusing on small and medium-sized enterprises and on growth in export industries and innovation. It further notes that the Government intends to undertake a review of the regulatory framework for the business sector, aimed at simplification and greater efficiency. The Committee requests the Government to continue to provide information on the impact of business development measures on employment creation and decent work. The Committee further requests the Government to provide information on the status of the review of the regulatory framework of the business sector.

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Articles 1 and 2 of the Convention. Employment trends and active labour market measures. The Committee notes the detailed report provided by the Government in November 2013, prepared in consultation with the Icelandic Tripartite ILO Committee. Referring to the goals set out in the Iceland 2020 policy statement, the Government indicates that a ministerial committee was appointed to examine the economy and the labour market. Two task forces were also appointed, one on the formulation of employment policy and job creation, and the other on labour market measures for the unemployed and remedial measures on vocational training and continuous education. As in the past, the aim was to develop an employment policy based on the principles established in collaboration with the social partners and various other entities, including representatives of the political parties. During the 2010–13 period, a regional development policy programme was implemented based on measures for innovation and employment development in line with Iceland 2020. One of the goals set out in Iceland 2020 is to reduce the unemployment rate to 3 per cent by 2020. The Government reports that there was a slow improvement in the labour market during the period covered by the report as the unemployment rate was, on average, 6 per cent during 2012, compared with 7.1 per cent in 2011. Following the period covered by the report, the Committee notes that unemployment decreased to 4.5 per cent in January 2014. Unemployment has been at higher levels in the metropolitan areas that in the rural areas in recent years. The lower exchange rate following the economic collapse had a positive effect on currency-generating employment sectors, such as fisheries, which are very important for many rural districts. One exception to this general pattern however is the poor employment situation in the Suðurnes region (unemployment rate was measured at 9.7 per cent in 2012). It further notes that a special programme entitled “A Way That Works”, a joint effort by government and the social partners which started in 2012, was designed to provide job-related remedial measures to 1,500 long-term unemployed people. The aim of the programme was to create new jobs for people who had been unemployed for long periods, with enterprises and municipalities, with support from the Unemployment Insurance Fund. The Government indicates that more than 1,400 people were engaged in work under the programme, two thirds of them in the private sector, and statistics show that 60 to 70 per cent of those who are engaged under schemes of this type are engaged for further periods when the funding ceases, becoming completely independent of the benefit system. The Committee invites the Government to continue to provide information on the impact of the measures taken to generate employment through the implementation of an active employment policy. It also invites the Government to include further information on the employment measures targeting the long-term unemployed.

Youth employment. The Government reports that unemployment rates among young people (aged 16–24) are far higher than among older people, standing at 14.6 per cent in 2011, 13.6 per cent in 2012 and 13.5 per cent in the first half of 2013. A number of job forums were established in Reykjavík and nearby municipalities in 2012 to serve people under the age of 25 who were neither involved in studies nor participated in the labour market. The Committee notes that the “Study is a Way that Works” programme, launched in 2011, aims to ensure access to places in secondary (post-compulsory) school for all applicants under the age of 25. Altogether, about 1,500 people registered on study courses under the programme, including 1,000 who were jobseekers. At the end of 2012, about 10 per cent of the group were back on unemployment benefits. A new group was admitted in the programme in autumn 2012, which was due to come to an end in the spring of 2014. The Committee invites the Government to continue to provide information on the impact of the measures taken to combat youth unemployment.

Education and training policies and programmes. The Committee notes that, in the context of Iceland 2020, emphasis was placed on a progressive educational policy in order to support economic development; this is to prioritize quality and investment in human resources, research and development. In allowing for this mutual relationship between educational and economic considerations, particular attention is to be given to enabling those who find themselves temporarily unemployed to have another opportunity to pursue studies or vocational training. The Committee invites the Government to provide information on the impact of the measures taken in the area of education and training policies and on their relation to the obtainment of productive employment for the beneficiaries of these measures.

Business development. The Committee notes the programmes launched in the field of entrepreneurial ventures. One such programme was focused on the development of individuals’ own commercial ideas, enabling them to work on these ideas for up to six months while drawing unemployment benefits. The Committee further notes the updated information the Government provides in its report concerning the Women’s Credit Guarantee Fund, including the total number of loan guarantees granted since 2011. The Committee invites the Government to continue to provide information on the impact of business development measures on employment creation and decent work.

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Articles 1 and 2 of the Convention. Employment trends and active labour market measures. The Committee notes the information provided by the Government in a report prepared with the Icelandic Tripartite ILO Committee and received in August 2012. The Government reports that unemployment has fallen from its peak level in 2009. In June 2009, unemployment reached 8.1 per cent, falling to 7.6 per cent in June 2010, and 6.7 per cent in June 2011. Unemployment is greater among young persons (aged 16 to 24) than among older persons (aged 60 and over). According to the labour market surveys by Statistics Iceland, 16 per cent of young people were unemployed in 2009 and 16.2 per cent in 2010. The Government indicates that its main tasks in the employment sphere are to cut unemployment by deliberate means, to eradicate long-term unemployment and to create a more solid foundation for the Icelandic business sector in the future. It also indicates that it is committed to promoting the formulation of a comprehensive employment policy for Iceland, based on equality of status between the occupational sectors, gender equality, healthy commercial practice and “green” economic development in accordance with the principles of sustainable development. This policy is to be implemented by means of consultation between central and local government, the social partners and the academic community. The Government further indicates that a broad campaign to generate employment will include measures aimed at enabling companies to take on people who are registered as unemployed in temporary positions with the support of the Unemployment Insurance Fund, improving the business environment for start-ups and innovative companies by adjustments to the tax legislation, prioritizing state-funded projects that call for large manpower input, and creating job opportunities for young persons. With respect to young persons, a total of ISK250 million was allocated by the Unemployment Insurance Fund in 2010 to create summer jobs for students in a campaign called “856 New Jobs”. The same approach was used in 2011 with a campaign to increase the number of jobs available in state and municipal bodies for students and other jobseekers. The Committee notes that the Government intends to initiate wide-range consultation under the leadership of the Office of the Prime Minister on regional development projects aimed at building up employment and future quality of life. Collaboration with the social partners is to be sought on active labour market measures to combat unemployment. The Committee invites the Government to provide information in its next report on the impact of the measures taken to generate employment through the implementation of an active employment policy. It also invites the Government to include in its next report further information on the employment measures implemented at the regional level in cooperation with the social partners (Article 3).

Youth employment. The Government reports that in autumn 2009, the Minister of Social Affairs and Social Security appointed a task force to examine the remedies available and educational options open to people who had lost their jobs, and to propose improvements. Extensive data was gathered on the circumstances of the unemployed, and when this was analysed, priority was given to establishing the position of young people as unemployment is highest in the under-30 age group. The Government indicates that the main aim in combating the negative effects of unemployment among young people was to reduce the number of persons who were inactive while receiving unemployment benefits. Further measures were seen as necessary to activate this group and enable continuing education centres, upper-secondary schools and foundation course departments to admit these individuals. It was proposed that attention be given to expanding the range of vocational training courses and increasing the number of courses designed to keep people involved in social activities. The Committee invites the Government to continue to provide information on the measures taken to combat youth unemployment.

Education and training policies. The Government reports that as of 2011 the Business Sector’s Educational Centre has administered the Educational Fund. Previously, grants for vocational training in the business sector were made by the Vocational Education Council. The role of the Educational Fund is to encourage the provision of suitable educational opportunities for persons with little formal education. The Committee notes that, as a further measure, the Government plans to set up the Workplace Study Fund. In this regard, the Government has decided to earmark ISK450 million for workplace study schemes in 2012–14. Furthermore, the programme “Study is a Viable Way” is based on proposals from a consultative group appointed by the Prime Minister and representing government ministries, all the parties represented in Parliament, the social partners and students’ movement. The financing for the programme was secured by agreement between the Government and the social partners in connection with collective wage agreements. The Committee notes that the programme aims to reduce the proportion of people aged 20–66 who have not completed upper-secondary education from 30 per cent to 10 per cent by 2020. The Committee invites the Government to provide information on the impact of the measures taken in the area of education and training policies and on their relation to the obtainment of productive employment for the beneficiaries of these measures.

Business development. The Government indicates that a collaborative programme, Entrepreneurial Enterprise, which is administered by the Directorate of Labour and Innovation Centre Iceland, aims at creating jobs for young people by supplying training and guidance to enable them to put their own entrepreneurial ideas into practice. With respect to business development and women, the Committee notes that the Women’s Credit Guarantee Fund was restored in March 2011. Its role is to support women to take part in employment and innovation by granting security for loans they obtain. The Fund’s priorities are to support women who own and operate small enterprises, to strive to increase the number of women owning and operating enterprise, to augment women’s access to capital for the purpose of running a business, to generate employment and encourage innovation in the business sector, and to encourage marginal groups of women (immigrants) to participate in business ventures. The Committee invites the Government to continue to provide information on the impact of business development measures on employment creation and decent work.

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The Committee notes that the Government’s report has not been received. It must therefore repeat its 2009 observation which read as follows:

Repetition
Articles 1 and 2 of the Convention. Employment trends and active labour market measures. The Committee takes note of the information provided in the Government’s report received in September 2009. The Government reports that its economy went into a major crisis in October 2008 when the banking system collapsed as a result of the global credit crunch, and that this recession will become even more severe in 2009. The Government further reports, that this crisis reduces the effectiveness of its monetary policies, and that repayments of credits can no longer be controlled. The Committee notes that, while there was little change in gross domestic product (GDP) in 2007 and 2008, forecasts allow for a contraction in GDP of up to 11 per cent in 2009. One of the consequences of the collapse of the banking system on the labour market is a great increase in unemployment, which rose from 1.3 per cent in September 2008 to 9.1 per cent in April 2009. The Government anticipates an average rate of unemployment for 2009 between 8 and 9 per cent. The Government also envisions unemployment benefits will be more than five times greater in 2009 than they were in 2008, i.e., about 25 billion Icelandic krona (ISK). The Government further hopes that the economy will recover with a rate of 2–3 per cent each year as from 2010, achieving a budgetary surplus in 2012. The Committee notes new programmes that the Government has implemented, such as a measure to amend the rules of the Icelandic Student Loan Fund, to meet the needs of those who have suffered financial setbacks. The Government has also begun a new development project, Starfsorka, which consists of a three-sided agreement between the Directorate of Labour, a company, and a jobseeker for an engagement in a position that involves innovation and development together with the payment of unemployment benefits. The aims of this project are to: (i) support new ventures and development within companies; (ii) establish contact between jobseekers and companies; (iii) support entrepreneurs who have ideas for new ventures; and (iv) support jobseekers and facilitate their search for employment. The Committee invites the Government to continue to provide information on measures taken to mitigate the consequences of the financial and economic crisis on its labour market.
Education and training policies. The Government reports that the Vocational Education Council disburses grants from the Ministry of Social Affairs Vocational Education Fund. In this regard, employers’ and workers’ organizations, companies, vocational education councils in the individual sectors and educational establishments, in collaboration with the above parties, are entitled to apply for grants. The Government further reports that the amount available for disbursal from the fund in 2009 is ISK35 million. The Committee requests the Government to continue to provide in its next report information on the measures taken in the area of education and training policies and on their relation to prospective employment opportunities.
Business and household developments. The Committee notes that the Government is reconstructing the banking system. It is also providing grants to those with innovative ideas for enterprise creation or growth. The Government reports that it has made partial unemployment benefit payments available where recipients were employed part time, and that remedial measures are now available for jobseekers. The Government also reports that it prioritizes supporting households, protecting welfare and preserving “safety nets”, that its Housing Financing Fund has a variety of means to lighten the burden of mortgage holders and other financial institutions, and that it prioritizes the full-strength functioning of businesses as means to resuscitate the national economy. To this end, the Government has reduced customs duties and its value added tax, has introduced construction projects financed by the State, and has granted the Housing Financing Fund broader authorizations to grant loans for maintenance projects that create employment. The Committee asks the Government to provide information in its next report on the impact of the measures to facilitate business growth and household prosperity. In addition, the Committee requests the Government to include information regarding the remedial measures it provides to jobseekers, and the effects of the above measures on lasting and productive employment.
Article 3. Participation of social partners in the formulation and application of policies. The Committee notes that the Ministry of Social Affairs and Social Security appoints local seven-member labour market councils. Each council consists of two members who are nominated by workers’ organizations, two members who are nominated by the employers’ associations, and representatives of the Minister of Education, Science and Culture, the Minister of Health and the local authorities’ association. These labour councils are to submit annual reports to the Directorate of Labour in November, along with proposals on the labour market measures they wish to prioritize the following year. The Committee asks the Government to report on the progress achieved for the implementation of the Convention by these councils. It trusts that the Government will continue to provide information on the consultations held on the matters covered by the Convention with the social partners, including details of their contribution to the implementation of an active employment policy.

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Articles 1 and 2 of the Convention. Employment trends and active labour market measures. The Committee takes note of the information provided in the Government’s report received in September 2009. The Government reports that its economy went into a major crisis in October 2008 when the banking system collapsed as a result of the global credit crunch, and that this recession will become even more severe in 2009. The Government further reports, that this crisis reduces the effectiveness of its monetary policies, and that repayments of credits can no longer be controlled. The Committee notes that, while there was little change in gross domestic product (GDP) in 2007 and 2008, forecasts allow for a contraction in GDP of up to 11 per cent in 2009. One of the consequences of the collapse of the banking system on the labour market is a great increase in unemployment, which rose from 1.3 per cent in September 2008 to 9.1 per cent in April 2009. The Government anticipates an average rate of unemployment for 2009 between 8 and 9 per cent. The Government also envisions unemployment benefits will be more than five times greater in 2009 than they were in 2008, i.e., about 25 billion Islandic krona (ISK). The Government further hopes that the economy will recover with a rate of 2–3 per cent each year as from 2010, achieving a budgetary surplus in 2012. The Committee notes new programmes that the Government has implemented, such as a measure to amend the rules of the Icelandic Student Loan Fund, to meet the needs of those who have suffered financial setbacks. The Government has also begun a new development project, Starfsorka, which consists of a three-sided agreement between the Directorate of Labour, a company, and a jobseeker for an engagement in a position that involves innovation and development together with the payment of unemployment benefits. The aims of this project are to, (i) support new ventures and development within companies; (ii) establish contact between jobseekers and companies; (iii) support entrepreneurs who have ideas for new ventures; and (iv) support jobseekers and facilitate their search for employment. The Committee invites the Government to continue to provide information on measures taken to mitigate the consequences of the financial and economic crisis on its labour market.

Education and training policies. The Government reports that the Vocational Education Council disburses grants from the Ministry of Social Affairs Vocational Education Fund. In this regard, employers’ and workers’ organizations, companies, vocational education councils in the individual sectors and educational establishments, in collaboration with the above parties, are entitled to apply for grants. The Government further reports that the amount available for disbursal from the fund in 2009 is ISK35 million. The Committee requests the Government to continue to provide in its next report information on the measures taken in the area of education and training policies and on their relation to prospective employment opportunities.

Business and household developments. The Committee notes that the Government is reconstructing the banking system. It is also providing grants to those with innovative ideas for enterprise creation or growth. The Government reports that it has made partial unemployment benefit payments available where recipients were employed part time, and that remedial measures are now available for jobseekers. The Government also reports that it prioritizes supporting households, protecting welfare and preserving “safety nets”, that its Housing Financing Fund has a variety of means to lighten the burden of mortgage holders and other financial institutions, and that it prioritizes the full-strength functioning of businesses as means to resuscitate the national economy. To this end, the Government has reduced customs duties and its value added tax, has introduced construction projects financed by the State, and has granted the Housing Financing Fund broader authorizations to grant loans for maintenance projects that create employment. The Committee asks the Government to provide information in its next report on the impact of the measures to facilitate business growth and household prosperity. In addition, the Committee requests the Government to include information regarding the remedial measures it provides to jobseekers, and the effects of the above measures on lasting and productive employment.

Article 3. Participation of social partners in the formulation and application of policies. The Committee notes that the Ministry of Social Affairs and Social Security appoints local seven-member labour market councils. Each council consists of two members who are nominated by workers’ organizations, two members who are nominated by the employers’ associations, and representatives of the Minister of Education, Science and Culture, the Minister of Health and the local authorities’ association. These labour councils are to submit annual reports to the Directorate of Labour in November, along with proposals on the labour market measures they wish to prioritize the following year. The Committee asks the Government to report on the progress achieved for the implementation of the Convention by these councils. It trusts that the Government will continue to provide information on the consultations held on the matters covered by the Convention with the social partners, including details of their contribution to the implementation of an active employment policy.

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The Committee notes the detailed information provided in the Government’s report received in September 2007, including replies to the matters raised in the 2005 direct request.

1. Articles 1, 2 and 3 of the Convention. Employment trends, active labour market policies and participation of the social partners in the formulation and application of policies. The Government indicates in its report that the unemployment rate was 2.1 per cent in 2005, down from 3.1 per cent in 2004, and that unemployment continued to decline in 2006. Government priorities for 2006 included measures targeting marginalized groups of workers such as younger persons, older persons and also young mothers. Cooperative schemes were also implemented with large enterprises targeting the long-term unemployed and persons with disabilities. One of the main objectives in 2006 was to reduce long-term unemployment and statistics show that this group of unemployed accounted for 1,500 persons in 2004 and fewer than 600 in 2006. The Government also indicates that youth unemployment fell considerably in 2005 and 2006, with 1,165 young unemployed persons in 2004 and 407 in 2006. As for persons with disabilities, 296 persons were registered as unemployed in 2005 and 272 in 2006. The Committee further notes that regional employment councils are appointed in each region in order to propose new labour market measures. The Government also decided to examine, in collaboration with the social partners, the situation of foreign workers in the country. The Committee would appreciate continuing to receive information on successes, problems encountered and lessons learned with regard to the application of the provisions of the Convention, especially with regard to vulnerable categories of workers.

2. Education and training policies. The Government indicates that the Labour Market Measures Act places emphasis on raising competencies of persons actively seeking employment through vocational training. The Government decided, in collaboration with the social partners, to mount a campaign to upgrade vocational training and retraining for unskilled workers and persons with lower education levels, and also to improve the position of foreign workers. The Committee notes that 4,064 jobseekers completed training programmes in 2004, down from 4,958 in 2003. It also notes that the Vocational Education Council has approved 42 projects in 2006 and that the budget was increased as compared to 2005. The Committee trusts that the Government will continue to provide information in its next report on the measures taken in the area of education and training policies and on their impact on prospective employment opportunities.

3. Business development. The Committee notes that the Government’s investment policy encourages entrepreneurial ventures through the Technological Development Fund and the New Business Venture Fund. The Minister of Commerce and Industry set out goals for 2004–07 which included the diversification of the business sector, the increased support of business development in rural areas and the improvement of the regulatory structure of the business sector. The Government indicates that effective assistance programmes are to be launched based on the needs of entrepreneurs in the rural areas. The Committee notes the measures taken to stimulate business growth in developed and underdeveloped regions and asks the Government to provide in its next report information on the effects of these measures on lasting and productive employment.

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Labour market policies. Participation of the social partners. The Committee notes the detailed information contained in the Government’s report for the period ending in May 2005, which describes the main trends of the economic measures taken and provides supplementary information on the development of active labour market policy measures. The Government indicates in its report that the unemployment rate fell slightly in 2004, reaching 3.1 per cent of the labour force. The priorities in the planning by the Directorate of Labour will take into account this decline in unemployment. Emphasis will be placed on integrating the Directorate’s services in the fields of unemployment benefit, labour exchange functions and remedial measures with those provided by other agencies, such as the local authorities and the State Social Security Institute. Attention will be given to the current development projects in the power-intensive sector and the issue of employment permits, labour exchange functions and the interaction of these elements. The Committee looks forward to receiving from the Government, in its next report, an assessment of the impact of its active labour market measures on long-term unemployment, rehabilitation of people with disabilities and employment for young workers. The Committee would also appreciate continuing to receive information on how employment programmes and priorities are reviewed within the framework of coordinated economic and social policies (Articles 1 and 2 of the Convention). Please also provide information on consultations with social partners under Article 3.

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1. The Committee notes the Government’s report for the period ending May 2002, in which it describes the main trends of the economic measures taken and their impact on employment and provides supplementary information on the development of active labour market policy measures. Supplemented by the data published by the OECD, the report demonstrates a gradual increase in unemployment which has rapidly accelerated in early 2003; unemployment during the first quarter of 2003 was estimated at 4.0 per cent as compared to 2.6 for the same quarter the previous year. The data also show a significant increase in long-term unemployment both in proportional and absolute terms. The Government states it has introduced various measures to address the problems arising due to the weak labour market including, inter alia, a considerable reduction in the number of work permits for foreigners, the promotion of regional development with the aim of rural job creation and the implementation of public works programmes to expand demand for labour and mitigate the effects of adverse economic conditions on workers.

2. The Government also reports that during the report period, expenditures in active labour market measures more than doubled. The bulk of new funds were used to implement the Government’s revised approach to vocational training as introduced in the year 2000 in the policy document entitled "Starfsmennt 2000" The policy introduces a revision of the functioning of the Vocational Training Council with the objective of changing its working methods in order to bring its efforts into line with changing needs of the business sector, companies and institutions. The Council now offers programmes aimed at meeting the new educational demands of the labour market, including programmes ranging from traditional vocational training to continuing education and special remedies such as training in social skills. The Committee has noted this information and would appreciate continuing to receive indications on how the government programmes and policies, aimed at overcoming the rising employment challenges, are kept under review within the framework of a coordinated economic and social policy, in accordance with Articles 1 and 2 of the Convention.

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The Committee notes that the Government’s report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the matters raised in its 2001 direct request which read as follows:

The Committee notes the information contained in the Government’s thorough report for the period ending 31 December 1999, which responds to all of the points raised in the report form.

1. Articles 1 and 2 of the Convention. According to the OECD, Iceland’s GDP grew at an average rate of 4.75 per cent from 1995 to 1999 but it has begun to slow down and is projected to be about 1.5 per cent this year, due mainly to inflation and higher restrictions on fish catches.

2. The Government states in its report that general unemployment fell from 2.8 per cent in 1998 to 1.9 per cent in 1999 and the OECD indicates that unemployment further fell to 1.3 per cent in 2000. The very tight labour market has resulted in record immigration. Unemployment among women fell from 4 per cent in 1998 to 2.7 per cent in 1999. The Government has implemented several programmes to promote employment of women, including grants to start businesses. Rural development also is a high priority and the Government has implemented various measures to this end. The Committee would appreciate receiving further information on the impact of these programmes on employment.

3. Article 3. In reply to previous comments, the Government states that consultation takes place through the occupational sectoral councils, which have employers’ and workers’ representatives. Please continue to supply information on the nature of these consultations, as well as their outcomes with regard to employment policies.

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The Committee notes the information contained in the Government’s thorough report for the period ending 31 December 1999, which responds to all of the points raised in the report form.

1. Articles 1 and 2 of the Convention. According to the OECD, Iceland’s GDP grew at an average rate of 4.75 per cent from 1995 to 1999 but it has begun to slow down and is projected to be about 1.5 per cent this year, due mainly to inflation and higher restrictions on fish catches.

2. The Government states in its report that general unemployment fell from 2.8 per cent in 1998 to 1.9 per cent in 1999 and the OECD indicates that unemployment further fell to 1.3 per cent in 2000. The very tight labour market has resulted in record immigration. Unemployment among women fell from 4 per cent in 1998 to 2.7 per cent in 1999. The Government has implemented several programmes to promote employment of women, including grants to start businesses. Rural development also is a high priority and the Government has implemented various measures to this end. The Committee would appreciate receiving further information on the impact of these programmes on employment.

3. Article 3. In reply to previous comments, the Government states that consultation takes place through the occupational sectoral councils, which have employers’ and workers’ representatives. Please continue to supply information on the nature of these consultations, as well as their outcomes with regard to employment policies.

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Articles 1 and 2 of the Convention. The Committee notes the information contained in the Government's detailed and informative report for the period ending December 1997. The Government states that the labour force participation rate for men is around 86 per cent and for women around 76 per cent; and the unemployment rate was 5.8 per cent in 1996 and 5.2 per cent in 1997. The Government's priorities are to balance the budget, provide economic stability, and control inflation. Changes in the Government's active labour market policies include payment of unemployment benefit for a fixed period to aspiring entrepreneurs and a combination of training and education for unemployed workers. It has also established various grants to promote the employment of women, such as the Employment Development Fund. The Government also has expanded its rural development policy with the aim of stimulating business investment through grants, loans, equity capital and through the provision of increased advice, assistance and employment counselling to the rural workforce. The Committee would appreciate being kept informed of the success of these policies and programmes in fulfilling the objectives of the Convention.

Article 3. The Committee notes with interest the adoption of the Labour Market Measures Act of 1997 to promote greater balance between supply and demand. This objective is to be achieved primarily through gathering information on the employment situation and prospects which regional councils can then use to make proposals on regional labour market measures. The councils include in their membership workers' and employers' representatives, a well as other groups with specific information on the labour market. The Committee would appreciate being kept informed of the types of proposals made by these regional councils and how their suggestions are implemented.

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1. The Committee notes with interest the Government's second and third reports for the periods ending June 1995 and June 1996 respectively. Referring also to the most recent data from the OECD, it notes that the increase in unemployment recorded during the previous period has been reversed and that after peaking at 5 per cent in 1995 the unemployment rate has been brought down to 4.3 per cent in 1996, while maintaining high activity rates. In this respect, the Committee would be grateful if the Government would continue to supply in its next reports detailed statistical information on the active population, employment and unemployment, like those provided in its second report.

2. The Committee notes the full information on the main trends in economic policy conducted during the period which are supplied in reply to the relevant questions on the report form. It requests the Government to continue to supply such information. The Committee notes in particular that the objectives of monetary, budgetary and exchange rate policies seem to be largely attained while the unemployment rate still remains higher than that which prevailed during the previous decade. It requests the Government to indicate how any measures taken for attaining employment objectives are kept under review "within the framework of a coordinated economic and social policy", in accordance with Article 2 of the Convention.

3. The Committee notes the indications on the application of active labour market policy measures and would be grateful if the Government would supply in its next report a description of the various programmes implemented, specifying the number of their beneficiaries. In addition, please indicate any new measures which have been taken to bring education and training policies more in line with employment prospects.

4. The Committee notes the detailed information supplied in the second report on the work of the consultative committee to the Employment Office and the Vocational Education Council, and requests the Government to continue to supply information on consultations with the social partners on the subject of policies which are conducted in accordance with Article 3 of the Convention.

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1. The Committee notes with interest the Government's first report on the application of the Convention for the period ending 30 June 1993. It was pleased to receive a clear and helpful exposition of the current economic conditions and of the problems being encountered. It notes the substantial decline in employment since 1992 and the rapid increase in the unemployment rate, which rose from 1.5 per cent in 1991 to 3 per cent in 1992. According to OECD data, this rise in unemployment continued, reaching 4.3 per cent in 1993. The Committee notes the information on the seasonal nature and uneven regional distribution of unemployment and requests the Government to supply detailed statistics in its next report, based on periodical surveys and studies, on the level and trends of employment, underemployment and unemployment, by sector and for the various categories of the active population. Please, in particular, indicate the participation and unemployment rates by sex and age and any significant impact of migratory movements on the size of the active population.

2. The Committee notes that the objective of the Government's general economic policy is to increase national earnings and improve the competitiveness of enterprises with a view to promoting employment. In this respect, the Committee notes the results which have been achieved in combating inflation. With reference to the report form, the Committee requests the Government to describe in its next report the manner in which the measures taken in fields such as budgetary, monetary and exchange rate policies and prices, incomes and wages policies contribute, "within the framework of a coordinated economic and social policy", to the attainment of the objective of full employment. The Committee notes the information concerning the activities of the Institute of Regional Development and requests the Government to supply information on the initiatives adopted to promote balanced regional development and encourage the development of new activities in regions that are currently in decline or undergoing restructuring. In more general terms, the Committee would be grateful if the Government would indicate the measures of structural nature taken in fields that are likely to have an impact on employment such as the management of fishing resources and the diversification of economic activities.

3. The Government states that measures have only recently been taken to intervene directly on the labour market in order to combat the rise in unemployment. Please describe the scope of these measures, with an indication of the number and category of beneficiaries. Please also continue to supply detailed information on vocational training activities and indicate the manner in which education and training policies are coordinated with prospective employment opportunities.

4. The Committee notes that employers' and workers' organizations are represented on the consultant committee to the Employment Office and on the Vocational Training Council. The Committee would be grateful if the Government would provide information on the activities of these advisory bodies, the matters that they consider, the opinions that they issue and the manner in which these opinions are taken into account in the formulation and implementation of employment policy measures.