This statistic shows the distribution of the gross domestic product (GDP) across economic sectors in Iceland from 2013 to 2023. In 2023, agriculture contributed around 3.82 percent to the GDP of Iceland, 21.06 percent came from the industry and 64.64 percent from the services sector.

In 2023, the highest number of employees in Iceland worked in the public administration, education, and health sector. Of Iceland's total of 219,300 employed persons, 63,000 worked within this sector. The wholesale and retail trade sector employed the second highest number of people at 25,000, while the tourism industry employed the third highest. The number of employed people in Iceland increased after a decline in 2020.

Key information about Iceland Industrial Production Index Growth

• Iceland Industrial production rose 11.7 % YoY in Dec 2018, following an increase of 1.8 % YoY in the previous year.
• Iceland Industrial production index growth rate YoY data is updated yearly, available from Dec 2008 to Dec 2018, with an average rate of 5.6 %.
• The data reached an all-time high of 41.1 % in Dec 2008 and a record low of -10.4 % in Dec 2016.

Iceland IS: Aerospace Industry: Total Exports data was reported at 39.848 USD mn in 2021. This records an increase from the previous number of 9.482 USD mn for 2020. Iceland IS: Aerospace Industry: Total Exports data is updated yearly, averaging 13.034 USD mn from Dec 1988 (Median) to 2021, with 34 observations. The data reached an all-time high of 698.859 USD mn in 2007 and a record low of 0.016 USD mn in 1991. Iceland IS: Aerospace Industry: Total Exports data remains active status in CEIC and is reported by Organisation for Economic Co-operation and Development. The data is categorized under Global Database’s Iceland – Table IS.OECD.MSTI: Trade Statistics: OECD Member: Annual.

In Iceland, from 2015, the implementation of the 2015 Frascati Manual edition has affected the distribution of personnel data by occupation. From reference year 2013, the R&D data collection methodology has been changed resulting in breaks in series. The main differences concern the redesign of the questionnaire, use of business registers in the sample selection mechanism, the legal obligation for firms to respond, the definition of key R&D concepts in the questionnaire, and changes in the allocation of institutions into the business or government sectors. New sampling methods caused a break in series in 2010 (or in 2011 for sectors with no 2010 data).

From 2014 onward, GBARD data are provided by Statistics Iceland and are compiled according to the Frascati Manual guidelines. From 2006, GBARD data make better use of R&D information from the state budget and are based on a better coverage of relevant R&D funding in major recipients organizations. From 1993, new methods for collecting and processing budget data for GBARD result in a break in series.

Graph and download economic data for Production, Sales, Work Started and Orders: Production Volume: Economic Activity: Industry (Except Construction) for Iceland (PRINTO01ISA661S) from 1998 to 2017 about Iceland, IP, and construction.

Travel and tourism contributed around 964 billion Icelandic króna – or around 6.86 billion U.S. dollars – to the gross domestic product in the northernmost European country in 2023. After the strong decline in 2020 due to the COVID-19 pandemic, the tourism sector seemed to have started the recovery in 2021.

Graph and download economic data for Production, Sales, Work Started and Orders: Production Volume: Economic Activity: Industry (Except Construction) for Iceland (PRINTO01ISQ661S) from Q1 1998 to Q4 2017 about Iceland, IP, and construction.

Technical testing and analysis companies provide crucial services to companies in all sectors of the economy. The construction, industrial production and energy sectors are the major markets for these services. These sectors depend on wider economic conditions, often dictating their demand for testing and analysis services. The COVID-19 outbreak and subsequent inflationary environment have heavily weighed on construction and manufacturing output, decimating demand for testing and analysis services. Revenue is projected to contract at a compound annual rate of 4.4% to €63.9 billion over the five years through 2024, including an estimated dip of 1.6% in 2024. A growing number of companies operating across Europe, alongside rising industrial production and a higher value of construction, have supported industry demand. However, strict lockdown restrictions during the COVID-19 outbreak hindered business sentiment and investment, delaying or cancelling major projects. The reduced level of industrial production and construction activity limited spending on testing services in 2020. As conditions improved and activity in the manufacturing and construction sectors rebounded, the need for materials and products to be tested surged. However, soaring inflation and heightened economic uncertainty have weakened spending on technical testing and analysis services as output in downstream markets has suffered. Improving economic conditions and lower European inflation rates will stimulate greater investment and business spending, with demand for technical testing and analysis following suit. Government funding and initiatives supporting the manufacturing and construction sectors will further bolster demand. Environmental efforts, driven by EU and UK's sustainability targets, will also generate an uptick for testing services as businesses strive to achieve accreditations and comply with regulations. Investments in advanced technology like AI, drones and telecommunication infrastructure will boost the need for comprehensive testing, especially in cybersecurity due to increasing threats. A growing number of testing and analysis companies will consequently expand their capabilities to reap the benefits of these opportunities. Revenue is forecast to expand at a compound annual rate of 4.3% to €78.8 billion over the five years through 2029.

The European cleaning services industry has rebounded robustly in the post-pandemic era, buoyed by greater office occupancy and a renewed focus on health and hygiene across both commercial and residential environments. As workforces have returned to physical workplaces, especially in key markets like France and Belgium, demand for regular and specialised cleaning contracts has jumped. Cleaning services revenue is forecast to climb at a compound annual rate of 0.3% over the five years through 2025. The industry’s recovery has been further supported by stabilising macroeconomic conditions, falling inflation rates and recent interest rate cuts across the eurozone, which have collectively strengthened consumer confidence and heightened corporate spending on non-core outsourced services like professional cleaning. European businesses have sought to ramp up sanitation protocols to ensure employee safety, triggering a spike in contract renewals and more frequent service cycles. Outfits like ISS A/S capitalised on the post-pandemic recovery, expanding their portfolios across major European economies. In 2025, revenue is expected to swell by 0.4% to €166 billion. There has been a notable shift towards sustainability, with cleaning providers investing in eco-friendly materials and practices, like microfibre technologies, biodegradable soaps and adherence to certifications including the EU Ecolabel, to meet rising demand from environmentally conscious clients. This not only helped retain existing clients but also differentiated providers in a highly competitive landscape. Over the five years through 2030, revenue is forecast to climb at a compound annual rate of 4.4% to €206.3 billion. Population expansion in urban centres, particularly in France, Ireland and the Nordics, is set to fuel ongoing demand for residential and public sector cleaning, while regions facing population decline, like Italy and much of Eastern Europe, may see stiffer competition and narrowing profit. The proliferation of artificial intelligence (AI) and robotic automation promises to redefine operational efficiency, allowing early adopters to secure premium contracts and mitigate chronic labour shortages. Macroeconomic tailwinds, including expected European GDP growth and cooling inflation, will spur commercial construction and facilities management contracts, supporting steady industry growth. However, providers who fail to innovate or differentiate, whether through sustainability or technology, will likely struggle to maintain market share in an industry that’s rapidly evolving on multiple fronts.

Iceland IS: Total Business Enterprise R&D Personnel: Per Thousand Employment In Industry data was reported at 22.813 Per 1000 in 2021. This records an increase from the previous number of 12.660 Per 1000 for 2017. Iceland IS: Total Business Enterprise R&D Personnel: Per Thousand Employment In Industry data is updated yearly, averaging 8.297 Per 1000 from Dec 1981 (Median) to 2021, with 27 observations. The data reached an all-time high of 22.813 Per 1000 in 2021 and a record low of 0.776 Per 1000 in 1981. Iceland IS: Total Business Enterprise R&D Personnel: Per Thousand Employment In Industry data remains active status in CEIC and is reported by Organisation for Economic Co-operation and Development. The data is categorized under Global Database’s Iceland – Table IS.OECD.MSTI: Number of Researchers and Personnel on Research and Development: OECD Member: Annual. In Iceland, from 2015, the implementation of the 2015 Frascati Manual edition has affected the distribution of personnel data by occupation. From reference year 2013, the R&D data collection methodology has been changed resulting in breaks in series. The main differences concern the redesign of the questionnaire, use of business registers in the sample selection mechanism, the legal obligation for firms to respond, the definition of key R&D concepts in the questionnaire, and changes in the allocation of institutions into the business or government sectors. New sampling methods caused a break in series in 2010 (or in 2011 for sectors with no 2010 data).From 2014 onward, GBARD data are provided by Statistics Iceland and are compiled according to the Frascati Manual guidelines. From 2006, GBARD data make better use of R&D information from the state budget and are based on a better coverage of relevant R&D funding in major recipients organizations. From 1993, new methods for collecting and processing budget data for GBARD result in a break in series.;

Definition of MSTI variables 'Value Added of Industry' and 'Industrial Employment':

R&D data are typically expressed as a percentage of GDP to allow cross-country comparisons. When compiling such indicators for the business enterprise sector, one may wish to exclude, from GDP measures, economic activities for which the Business R&D (BERD) is null or negligible by definition. By doing so, the adjusted denominator (GDP, or Value Added, excluding non-relevant industries) better correspond to the numerator (BERD) with which it is compared to.

The MSTI variable 'Value added in industry' is used to this end:

It is calculated as the total Gross Value Added (GVA) excluding 'real estate activities' (ISIC rev.4 68) where the 'imputed rent of owner-occupied dwellings', specific to the framework of the System of National Accounts, represents a significant share of total GVA and has no R&D counterpart. Moreover, the R&D performed by the community, social and personal services is mainly driven by R&D performers other than businesses.

Consequently, the following service industries are also excluded: ISIC rev.4 84 to 88 and 97 to 98. GVA data are presented at basic prices except for the People's Republic of China, Japan and New Zealand (expressed at producers' prices).In the same way, some indicators on R&D personnel in the business sector are expressed as a percentage of industrial employment. The latter corresponds to total employment excluding ISIC rev.4 68, 84 to 88 and 97 to 98.

Iceland IS: Business Enterprise Researchers: Per Thousand Employment in Industry data was reported at 10.303 Per 1000 in 2021. This records an increase from the previous number of 6.165 Per 1000 for 2017. Iceland IS: Business Enterprise Researchers: Per Thousand Employment in Industry data is updated yearly, averaging 5.056 Per 1000 from Dec 1981 (Median) to 2021, with 26 observations. The data reached an all-time high of 10.303 Per 1000 in 2021 and a record low of 0.364 Per 1000 in 1981. Iceland IS: Business Enterprise Researchers: Per Thousand Employment in Industry data remains active status in CEIC and is reported by Organisation for Economic Co-operation and Development. The data is categorized under Global Database’s Iceland – Table IS.OECD.MSTI: Number of Researchers and Personnel on Research and Development: OECD Member: Annual. In Iceland, from 2015, the implementation of the 2015 Frascati Manual edition has affected the distribution of personnel data by occupation. From reference year 2013, the R&D data collection methodology has been changed resulting in breaks in series. The main differences concern the redesign of the questionnaire, use of business registers in the sample selection mechanism, the legal obligation for firms to respond, the definition of key R&D concepts in the questionnaire, and changes in the allocation of institutions into the business or government sectors. New sampling methods caused a break in series in 2010 (or in 2011 for sectors with no 2010 data).From 2014 onward, GBARD data are provided by Statistics Iceland and are compiled according to the Frascati Manual guidelines. From 2006, GBARD data make better use of R&D information from the state budget and are based on a better coverage of relevant R&D funding in major recipients organizations. From 1993, new methods for collecting and processing budget data for GBARD result in a break in series.;

Definition of MSTI variables 'Value Added of Industry' and 'Industrial Employment':

R&D data are typically expressed as a percentage of GDP to allow cross-country comparisons. When compiling such indicators for the business enterprise sector, one may wish to exclude, from GDP measures, economic activities for which the Business R&D (BERD) is null or negligible by definition. By doing so, the adjusted denominator (GDP, or Value Added, excluding non-relevant industries) better correspond to the numerator (BERD) with which it is compared to.

The MSTI variable 'Value added in industry' is used to this end:

It is calculated as the total Gross Value Added (GVA) excluding 'real estate activities' (ISIC rev.4 68) where the 'imputed rent of owner-occupied dwellings', specific to the framework of the System of National Accounts, represents a significant share of total GVA and has no R&D counterpart. Moreover, the R&D performed by the community, social and personal services is mainly driven by R&D performers other than businesses.

Consequently, the following service industries are also excluded: ISIC rev.4 84 to 88 and 97 to 98. GVA data are presented at basic prices except for the People's Republic of China, Japan and New Zealand (expressed at producers' prices).In the same way, some indicators on R&D personnel in the business sector are expressed as a percentage of industrial employment. The latter corresponds to total employment excluding ISIC rev.4 68, 84 to 88 and 97 to 98.

European software publishers' revenue is forecast to swell at a compound annual rate of 5% over the five years through 2025 to reach €70.6 billion. Software sales have been driven up by hiking digitalisation and technological developments across the continent. The software publishing market has been characterised by acquisitions, with global publishers looking to remain on top of market trends and protect their competitive positions by acquiring smaller, niche publishers. While internal research and development remain crucial, acquisitions have become the go-to method for many large software companies to find new products. Revenue is set to jump by 6.4% in 2025. Industry profit has remained high but has trended downwards. The industry’s performance has been buoyed by record e-commerce growth, heightened cyber risks driving software investment and a wave of strategic acquisitions by major publishers seeking to bolster their capabilities and global reach. Software publishers have capitalised on Europe’s rapid shift online, as evidenced by the near-doubling of industry revenue in digital-forward regions like Finland and Denmark. Cybersecurity remains a central theme, with heightening ransomware and data breach incidents, particularly in Spain and Italy, driving businesses to ramp up their investment in technical support and security solutions. Meanwhile, the industry’s innovation pipeline has been shaped by high-profile acquisitions, like SAP’s purchases of LeanIX and WalkMe, which have fortified the dominance of major publishers while raising barriers to entry for smaller publishers. Over the five years through 2030, revenue is slated to swell at a compound annual rate of 10.2% to reach €114.5 billion. The future for software publishers looks bright, with new technology development and the expanding use of advanced software by businesses set to stimulate demand. More publishers are likely to adopt the software-as-a-service distribution model, benefitting from a steadier flow of funds compared with traditional business models, which require consumers to make a one-time purchase of updated software. High-profile investments from major publishers, like Microsoft’s €3 billion drive to expand cloud and AI infrastructure in Sweden, will further support this trajectory. Skills shortages in AI and cloud computing are set to persist, with a projected gap of 8 million tech professionals by 2030, which may constrain smaller publishers’ capacity to innovate. The continued shift towards subscription-based SaaS models is poised to stabilise and enlarge revenue streams. As industry leaders bundle software with services and technical support, the European software publishing sector’s growth prospects remain strong, albeit shaped by regulatory, talent, and competitive dynamics.

Release of greenhouse gasses from the Icelandic economy (main sectors) 1995-2016

Iceland IS: Aerospace Industry: Total Imports data was reported at 210.860 USD mn in 2021. This records an increase from the previous number of 90.181 USD mn for 2020. Iceland IS: Aerospace Industry: Total Imports data is updated yearly, averaging 86.564 USD mn from Dec 1988 (Median) to 2021, with 34 observations. The data reached an all-time high of 460.494 USD mn in 2007 and a record low of 9.434 USD mn in 1988. Iceland IS: Aerospace Industry: Total Imports data remains active status in CEIC and is reported by Organisation for Economic Co-operation and Development. The data is categorized under Global Database’s Iceland – Table IS.OECD.MSTI: Trade Statistics: OECD Member: Annual.

In Iceland, from 2015, the implementation of the 2015 Frascati Manual edition has affected the distribution of personnel data by occupation. From reference year 2013, the R&D data collection methodology has been changed resulting in breaks in series. The main differences concern the redesign of the questionnaire, use of business registers in the sample selection mechanism, the legal obligation for firms to respond, the definition of key R&D concepts in the questionnaire, and changes in the allocation of institutions into the business or government sectors. New sampling methods caused a break in series in 2010 (or in 2011 for sectors with no 2010 data).

From 2014 onward, GBARD data are provided by Statistics Iceland and are compiled according to the Frascati Manual guidelines. From 2006, GBARD data make better use of R&D information from the state budget and are based on a better coverage of relevant R&D funding in major recipients organizations. From 1993, new methods for collecting and processing budget data for GBARD result in a break in series.

Iceland IS: Pharmaceutical Industry: Total Imports data was reported at 244.098 USD mn in 2021. This records an increase from the previous number of 189.094 USD mn for 2020. Iceland IS: Pharmaceutical Industry: Total Imports data is updated yearly, averaging 110.898 USD mn from Dec 1988 (Median) to 2021, with 34 observations. The data reached an all-time high of 244.098 USD mn in 2021 and a record low of 23.946 USD mn in 1988. Iceland IS: Pharmaceutical Industry: Total Imports data remains active status in CEIC and is reported by Organisation for Economic Co-operation and Development. The data is categorized under Global Database’s Iceland – Table IS.OECD.MSTI: Trade Statistics: OECD Member: Annual.

In Iceland, from 2015, the implementation of the 2015 Frascati Manual edition has affected the distribution of personnel data by occupation. From reference year 2013, the R&D data collection methodology has been changed resulting in breaks in series. The main differences concern the redesign of the questionnaire, use of business registers in the sample selection mechanism, the legal obligation for firms to respond, the definition of key R&D concepts in the questionnaire, and changes in the allocation of institutions into the business or government sectors. New sampling methods caused a break in series in 2010 (or in 2011 for sectors with no 2010 data).

From 2014 onward, GBARD data are provided by Statistics Iceland and are compiled according to the Frascati Manual guidelines. From 2006, GBARD data make better use of R&D information from the state budget and are based on a better coverage of relevant R&D funding in major recipients organizations. From 1993, new methods for collecting and processing budget data for GBARD result in a break in series.

Graph and download economic data for Infra-Annual Labor Statistics: Employment: Economic Activity: Industry (Except Construction): Total for Iceland (LFEAINTTISQ647N) from Q2 1998 to Q4 2024 about Iceland, construction, employment, and industry.

Graph and download economic data for Infra-Annual Labor Statistics: Employment: Economic Activity: Industry (Including Construction): Total for Iceland (LFEAICTTISQ647S) from Q1 2003 to Q4 2023 about Iceland, construction, employment, and industry.

Iceland IS: BERD: % of Value Added data was reported at 3.337 % in 2021. This records an increase from the previous number of 2.898 % for 2020. Iceland IS: BERD: % of Value Added data is updated yearly, averaging 2.056 % from Dec 1981 (Median) to 2021, with 34 observations. The data reached an all-time high of 3.337 % in 2021 and a record low of 0.090 % in 1981. Iceland IS: BERD: % of Value Added data remains active status in CEIC and is reported by Organisation for Economic Co-operation and Development. The data is categorized under Global Database’s Iceland – Table IS.OECD.MSTI: Business Enterprise Investment on Research and Development: OECD Member: Annual. In Iceland, from 2015, the implementation of the 2015 Frascati Manual edition has affected the distribution of personnel data by occupation. From reference year 2013, the R&D data collection methodology has been changed resulting in breaks in series. The main differences concern the redesign of the questionnaire, use of business registers in the sample selection mechanism, the legal obligation for firms to respond, the definition of key R&D concepts in the questionnaire, and changes in the allocation of institutions into the business or government sectors. New sampling methods caused a break in series in 2010 (or in 2011 for sectors with no 2010 data).From 2014 onward, GBARD data are provided by Statistics Iceland and are compiled according to the Frascati Manual guidelines. From 2006, GBARD data make better use of R&D information from the state budget and are based on a better coverage of relevant R&D funding in major recipients organizations. From 1993, new methods for collecting and processing budget data for GBARD result in a break in series.;

Definition of MSTI variables 'Value Added of Industry' and 'Industrial Employment':

R&D data are typically expressed as a percentage of GDP to allow cross-country comparisons. When compiling such indicators for the business enterprise sector, one may wish to exclude, from GDP measures, economic activities for which the Business R&D (BERD) is null or negligible by definition. By doing so, the adjusted denominator (GDP, or Value Added, excluding non-relevant industries) better correspond to the numerator (BERD) with which it is compared to.

The MSTI variable 'Value added in industry' is used to this end:

It is calculated as the total Gross Value Added (GVA) excluding 'real estate activities' (ISIC rev.4 68) where the 'imputed rent of owner-occupied dwellings', specific to the framework of the System of National Accounts, represents a significant share of total GVA and has no R&D counterpart. Moreover, the R&D performed by the community, social and personal services is mainly driven by R&D performers other than businesses.

Consequently, the following service industries are also excluded: ISIC rev.4 84 to 88 and 97 to 98. GVA data are presented at basic prices except for the People's Republic of China, Japan and New Zealand (expressed at producers' prices).In the same way, some indicators on R&D personnel in the business sector are expressed as a percentage of industrial employment. The latter corresponds to total employment excluding ISIC rev.4 68, 84 to 88 and 97 to 98.

Of the foreign inhabitants residing in Iceland in 2023, the highest number had a Polish origin. Over 23,000 people with a Polish origin lived in Iceland. Danes, who made up the second largest group of foreign-born citizens, only counted 3,900 people. People from Poland also made up the largest group of people immigrating to Iceland in 2022.

Poles in Iceland

The number of immigrants from Poland started to increase after the country joined the European Union in 2004. Even though Iceland is not a member of the EU, it is a part of the European Economic Area (EEA), meaning that people from Poland do not need a residence or work permit when moving to Iceland. Traditionally, many Poles have been working in Iceland's important fishing industry, but in recent years, tourism, health care, and construction have also become important industries for Polish immigrants. In 2022, the tourism industry was the third largest employer in the country.

Employment in Iceland

The Nordic country is known for its high employment rates and high living standards. In 2022, more than 83 percent of the country's working age population was employed. This was the highest of the OECD countries that year.

Before the pandemic, the Basic Chemical Manufacturing industry enjoyed a period of strong demand, particularly from Asia. Innovation in speciality chemicals and sustainability initiatives gained momentum, helping raise profitability. When the pandemic hit, supply chains were greatly disrupted while industrial output stumbled until socially distanced factory guidelines were adopted. As industrial output ramped up, manufacturers' revenue benefited from pent-up demand and government fiscal packages, leading to substantial infrastructure spending and stimulus. Russia's invasion of Ukraine added another spanner to works, though, with energy and feedstuff prices skyrocketing as a result of western countries' sanctions on Russian exports. Production costs escalated and business and consumer confidence was shot by rising living costs, denting demand throughout 2022 and 2023. Profitability has also been hit hard by soaring operational costs, which manufacturers have struggled to pass on to clients. Over the five years through 2024, revenue is forecast to fall at a compound annual rate of 5.3% to €217.5 billion, including a 4.8% contraction in 2024. Inflation concerns remain strong, although they are easing. Borrowing costs remain inflated, dissuading large investments in construction projects and cutting into sales of basic chemicals used in insulation and building plastics. Over the five years through 2029, basic chemical manufacturers' revenue is anticipated to grow at a compound annual rate of 2.7% to reach €248.1 billion. The long-term outlook of the industry is optimistic yet cautious. Growth depends on innovation in bio-based chemicals and circular economy solutions. Embracing digitalisation and automation will be key in lowering manual labour requirements and lifting productivity.