The Blue Lagoon Lays Off 164 Workers Due To COVID-19

164 Blue Lagoon workers have been laid off as the company deals with the economic fallout of the COVID-19 outbreak in Iceland, reports Morgunblaðið. These firings come following the recent decision to close the Blue Lagoon until at least April 30th.

The Blue Lagoon used to employ around 764 people in its resort, restaurants, and shops, but over 20% of the staff have now been fired. 400 of the company’s remaining staff will go from full-time to part-time in order to allow them to claim reduced work payouts from the government. The Unemployment Insurance Fund will pay up to 75% of their wages, but workers will still be faced with a considerable drop in income.

In a letter sent out to workers, Grímur Sæmundsen, CEO of the Blue Lagoon, describe the decision as “difficult for us but inevitable in light of the current circumstances,” Morgunblaðið reports. Grímur went on to thank employees for their “great work” and expressed the hope that many would be rehired when the Blue Lagoon reopens. He concluded his letter, “I have full faith that we will get through this together,” a sentiment that will likely hold a bitter irony for fired workers.

The Blue Lagoon is one of Iceland’s most popular attractions and has enjoyed healthy profits in recent years. As Kjarninn reports, the company’s profit in 2018 was 3.7 billion ISK (€26.4 mil) with dividend payouts worth 4.3 billion ISK (€30 mil) made in 2019.

The Blue Lagoon firings reveal the devastating impact of the COVID-19 pandemic on the Icelandic tourism sector, as travel restrictions and infection fears have all but halted the arrival of foreign tourists to the country. Similar waves of dismissals have been seen at major hotel chains and Icelandair. The government has announced measures to attempt to aid the tourism sector including digital gift certificates worth 1.5 billion ISK for Icelanders to spend on domestic tourism when the outbreak has subsided. Despite these efforts, COVID-19 will undoubtedly have serious long-term impacts on Iceland’s tourism-dependent economy.

Tune into our daily COVID-cast for more on recent coronavirus-related developments in Iceland.

Note: Due to the effect the Coronavirus is having on tourism in Iceland, it’s become increasingly difficult for the Grapevine to survive. If you enjoy our content and want to help the Grapevine’s journalists do things like eat and pay rent, please consider joining our High Five Club.