The labor force numbered 159,000 in 2000. In 1999, 12% of employment in Iceland was in fishing or fish processing, 13% in manufacturing, 11% in construction, 5% in agriculture, with the remainder in services. In 2002 the estimated unemployment rate was 2.8%.
As of 2002, about 85% of workers are union members. Principal unions are the Icelandic Federation of Labor (associated with the ICFTU) and the Municipal and Government Employees' Association. Labor disputes are settled by direct negotiations or by special courts, however strikes are permitted. Collective bargaining is used to negotiate pay, hours, and other conditions.
The customary workweek is 40 hours. Workers are entitled to overtime pay in excess of eight hours per day. There is no legal minimum wage, but wages are negotiated through collective bargaining. Even the lowest paid workers earn sufficient wages to provide a decent standard of living. Child labor standards are stringent and strictly enforced.