The City of Reykjavík has established a fund of ISK 150 million (USD 1.2 million, EUR 856,000) to stimulate the local employment market. The largest part, ISK 80 million, will be used for projects that are undertaken in cooperation with the Directorate of Labor.

Reykjavík City Hall. Photo by Páll Stefánsson.

These projects include vocational training, innovation projects, a special employment reinforcement initiative and experimental hiring of unemployed individuals, who will be able to work for the City of Reykjavík for two to six months, Mbl TV reports.

The remaining amount will be used for the benefit of special groups. “We are looking at the effect of unemployment on many groups. The young people, for example, we are very concerned about them,” said Oddný Sturludóttir, chairperson of the Reykjavík City Employment Affairs Council.

“Therefore we are putting 30 million in a special fund for young people,” Sturludóttir added. “It is both intended for employment creation for their benefit and to support projects. It was advertised publicly and everyone can apply for funding, young people, individuals, organizations and city institutions.”

Sturludóttir explained that there is also a group of people who don’t qualify for unemployment benefits but are instead given financial support from Reykjavík City. ISK 20 million will be used to stimulate their employment prospects and welfare.

Also, part of the fund is especially intended for innovation projects for students and for workers with disabilities.

“It is a certain injection [to the employment market] and also a recognition of the social importance of Reykjavík City in a period of unemployment,” Sturludóttir said.

There will be disbursements from the fund a few times a year and the first disbursement will be made shortly; applications for funding must be handed in by March 1, June 1 and September 1.

Click here to read more about unemployment in Iceland.