It may not sound like much, but for this small North Atlantic island, it's highly symbolic. Shortly into this new year, Iceland's population is set to pass the 400,000 mark (the equivalent of the urban area of Saint-Étienne in France), according to estimates from the University of Iceland published on Tuesday, January 2 by the daily Morgunbladid.
In September, a report by the public building and housing authority went so far as to announce that the 400,000 mark could be reached before the end of 2023. At the time of the last census, on January 1, 2023, the population stood at 387,758.
At a time when many European countries are seeing their populations stagnate or decrease, the volcanic island is recording strong demographic growth. Since 2008, it has increased by 23%. After World War II, Icelanders numbered just over 125,000. According to historical data from the national statistics institute, the population long stagnated at around 50,000 to 60,000, before steadily increasing in the early 20th century.
The sharp rise in recent years is partly due to the economic turnaround seen in the country following the collapse of its banking system in 2008. After a sharp fall (-7.7% in 2009), gross domestic product (GDP) grew by 4.6% in 2013 and as much as 6.3% in 2016. This was due to the remarkable upsurge in tourism. Since 2011, when the eruption of the Eyjaffjallajökull volcano put the island and its rugged landscape in the international spotlight, visitor numbers have been rising steadily: 459,252 in 2010, 969,181 in 2014, and almost 2 million in 2017... According to forecasts by Islandsbanki, there should be 2.1 million visitors by 2023, and more than 2.5 million within two years.
It comes as no surprise then that the boom encountered in hotels, restaurants and various excursions has led to a significant demand for foreign labor, and the unemployment rate is at an all-time low (3.1% in October 2023). According to the latest official data, immigrants represent 18% of the population, ten percent more than 15 years ago. Out of the 31,200 people working in tourism in June 2023, almost half were immigrants. 34.2% of them were Poles, the largest group, followed by Lithuanians and Romanians. A further 30% of 26-36 year-olds are of foreign nationality.
Most speak English as their working language – Icelandic being a particularly difficult language to learn – and are concentrated around the capital. Due to soaring rents and Airbnb rentals, many are struggling to find suitable accommodation.
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