From Iceland — Iceland's Economy Recovering Slowly

Iceland’s Economy Recovering Slowly

Published February 2, 2012

Al-Jazeera has done some rather frank reporting on the state of the Icelandic economy, positing that while things are slowly returning to normal, the recovery is not necessarily being felt on the street level yet.
The article begins by looking at the situation we find ourselves in today:

People lost their jobs, or took wage cuts, or were banned from working overtime or worked on the black market. Those in the building sector were particularly affected, as the house market collapsed. However, the unemployment level has improved somewhat, and now only 6.1 per cent of Icelanders are registered unemployed. … In Iceland, a nation of 300,000, about 75 per cent of people own the property they live in.

Nonetheless, these small indicators of things returning to normal do not necessarily mean that the average Icelander feels the changes themselves. A number of people are still struggling to keep up with their mortgage payments. In some instances, people will turn to the Debtors’ Ombudsman, a public service that helps the average person manage their debt. Other people leave the country altogether.
That said, the economic downturn has not been all bad.

For instance, children are happier. Icelanders have always worked extremely long hours, often doing two or more jobs. With overtime cut back after the crash, they have more time to spend with family and friends.
The crisis also made people suddenly wake up and take stock of their situation. Is it really necessary to have two new, fuel-hungry 4-WD cars for a family of four? Perhaps not. Today, signs of extravagances of pre-crash consumerism are said to be “very 2007”.
And yet wages in banks are increasing. There has been an upsurge in the sale of luxury cars. Icelanders are once again flocking to overseas cities on shopping trips – this time Boston is popular.
After its final review of the Icelandic economy, the IMF declared that Iceland’s economy was recovering well. Clearly at least some Icelanders are benefitting from the new situation.

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