Northeast Iceland's manyfacedet labour market

Hælið, which the museum is called, is part of the dark tourism phenomenon. Like the catacombs of Paris, Ground Zero in New York or Tsjernobyl, this is about death, pain and suffering. But it is also about the will to live and the desire to make use of what is available and make the best out of things.

Maria Pálsdóttir grew up on a farm neighbouring Kristines Hospital –  built in 1927 to treat tuberculosis patients from the northern part of Iceland. A total of 5,900 Icelanders died from the disease between 1911 and 1970. Globally, TB has been the deadliest disease of all over the past 200 years. The sanatorium is near Akureyri in the north-eastern part of the country. 

When Maria Pálsdóttir visited her old stomping grounds in 2015, she was saddened to see how many of the buildings had fallen into disrepair. She originally trained as an actor, but decided that something had to be done.

The walls in one of the rooms in the museum have been covered in copies of letters written to and from the sanatorium. 

“When I announced the plans to restore the sanatorium, I immediately got contacted by Icelanders who had had relatives there or who had experienced being treated there as children,” she says.  

To her surprise, one of them was former Icelandic President Ólafur Ragnar Grímsson, whose mother Svanhildur fought TB for most of her life until her death at 51. He gave Pálsdóttir two million Icelandic kronor (€13,600) as startup capital and others followed suit with smaller amounts.

Today, the museum is a captivating experience – especially if Maria Pálsdóttir herself is the guide. As an actor, she knows exactly which stories will touch your heart.

Before the 1970s, there was no cure for TB other than rest, vitamins, sunshine and fresh air. Sometimes, the body’s immune system managed to beat the disease. One extreme operation that was used involved removing parts of the ribs, causing the lungs to collapse and starving the tuberculosis bacteria of oxygen.

“I still need to hold down three other jobs, so I cannot make a living from the museum and café alone. But it tells an important story which feels much more relevant after the Covid-19 pandemic,” she says.

Not far from the old sanatorium lies Jólahúsið (the Christmas House) which “everybody” who comes to Akureyri visits. The house offers a year-round orgie of Christmas decorations of all kinds and sweets are sold at a fast pace.

“We are nine employees here now, but this is still very much a family business,” says Erna Rún Halldorsdóttir, whose parents built the Christmas house.

“We actually get most visitors in summer.”

Erna Rún Halldorsdóttir at the Christmas House sells sweets and Christmas decorations all year round.

Under all the sugar there is a slight bitter undertone because the Icelandic Christmas is not like that of other countries. There are 13 Santa Clauses who are all children of the troll witch Grýla. In the 13 days leading up to Christmas, every morning children get presents in socks that have been hung up, but if they have been naughty they get an old potato instead – although we doubt many children risk getting that today. 

Icelanders are after all like most people, but they often have a slightly different perspective on things. With just 1.3 people per square kilometre, the relationship between people and nature is different from more crowded areas of the world.

That is also why Hjalti Páll Þórarinsson, project leader for Visit Northern Iceland, concludes that this part of the country runs no risk of becoming a victim of over-tourism. 

“There are still many places where nothing happens at all. But large numbers of tourists can be a challenge, of course. Especially at airports or in harbours, where we might get bottlenecks when many people arrive at once.”

Rögvaldur Gudmundsson and Hjalti Páll Þórarinsson, with Akureyri in the background.

Northern Iceland can boast that 97 per cent of visitors are very satisfied or satisfied with their experience. 44 per cent of visitors to Iceland go to the northern side, and these are often people who have been there before. In the south, “The Golden Route” has been promoted for 40 years – a round trip which takes you to Thingvellir where the great continental shelves meet, the water-spouting Geysir and the large Gullfoss waterfall. 

“Here in the North, we didn’t want to be outdone, so we started promoting ”The Diamond Circle” a few years back and it has been a huge success,” says Hjalti Páll Þórarinsson.

The number of overnight hotel stays in Northern Iceland so far this year compared to the record year of 2018. The red line is 2023, which has remained above 2018 every month bar January. Source: Statistics Iceland. The picture of Dettifoss was taken by Tim Bekaert, Wikipedia

The most important stops on the tour, which is hard to fit into only one day, are the small town of Húsavik, the deep valley of Ásbyrgi, lake Mývatn och Dettifoss, the most powerful waterfall in Europe whether you measure the amount of water, the height or the width.

Tourism is Iceland’s most important industry. It is organised in a different way to most other countries where the travel industry is made up of larger companies. This is particularly the case in Northern Iceland.

“There are 900 tourist companies outside of Reykjavik – most are made up of only one or two people,” says Hjalti Páll Þórarinsson.

They are guides with their own all-terrain vehicles, small restaurants that sometimes operate out of private houses and fishing boats that are used for whale safaris. This is combined with a very strong support for culture and sport, which benefits both locals and tourists. 

Out of the 39,000 people who live in the North-East, 20,000 are in Akureyri. It might not sound like a big place, but it is actually the largest town in Iceland. Compared to other Nordic towns of a similar size, it boasts:

• A university with 2,000 students
• 8 sports halls and 4 indoor swimming pools
• A cultural center with a large 590-seater hall
• A music school with 400 students

The Akureyri Cultural Center is circular and the only building next to the Harpa concert hall in Reykjavik to be finished after an economic crisis hit Iceland in 2018. 

“Getting people to want to live here in Northern Iceland is not only about offering enough jobs. We also asked: ‘What do we do after 5 pm?’,” says Rögvaldur Gudmundsson, who heads the Association of Municipalities in Northeast Iceland. 

“Culture is important, just like making sure children and young people have it good. So we support many different cultural projects every year – one of them is the tuberculosis museum.” 

He admits that as long as unemployment is as low as three per cent, there will not be that much innovation. 

“Everybody’s already got a job,” he says. 

But when we look around the town, we are struck by the number of unexpected experiences – like the art museum showcasing works that might as well have been exhibited in New York.

Akureyri Art Museum is one of the newest art museums in Iceland, opened in 1993. It is housed in what used to be a cooperative, a building with strong Bauhaus and Funkis design influences. 

Akureyri art museum is one of Iceland's youngest, founded in 1993. It is housed in a former cooperative, designed with strong Bahaus and Funkis influences.

“Oh wow! This is fantastic! How provocative,” exclaims a group of three American women who look like they have visited many art exhibitions in their lives, as they watch Icelandic artist Brynhildur Kristinsdóttir’s images, videos and objects that explore what it is to be masculine and feminine.

“Some of us choose to spread like rats – in all directions – while others choose to go straight ahead,” she writes in her presentation of her exhibition. 

Northern Iceland does not live off tourism alone, however. Fishing is still a major industry, and the situation for energy-intensive industries is good in Iceland, where energy prices are not linked to the European market.  

Grétar Thór Eythórsson and Hjalti Jóhannesson from the University of Akureyri are doing research on how global trends will impact North-Eastern Iceland's labour market.

On both sides of Akureyri are towns that are dominated by a few companies. As a result, they have been chosen to participate in a Nordic research programme called SunRem – short for “Sustainable Remote Nordic Labour Markets”. It looks at a number of isolated labour markets across the Nordic region. Researchers Hjalti Jóhannesson and Grétar Thór  Eythórsson in Akureyri represent the Icelandic part of the project, which is partially financed by NordForsk.

“We will be looking at how labour markets are influenced by trends like digitalisation, globalisation and climate change, which we cannot control ourselves,” explains Hjalti Jóhannesson.

The town of Dalvik has 1,906 inhabitants and the labour market is completely dominated by the Icelandic company Samherji, which is one of the Icelandic fishing industry’s largest businesses. It runs fish processing plants in both Akureyri and Dalvik.

Samherji's Dalvik processing plant. Photo: Samherji.

“The Dalvik fish processing plant is the world’s most modern and it employs 165 people. There has been a lot of work to improve the working environment there, where they filet cod and other white fish. Since it lies just 40 kilometres from Akureyri, there are quite a few who commute in both directions. The number of immigrant labourers is also relatively large. 13 per cent of the inhabitants are foreign nationals.”

Húsavik is somewhat bigger with 3,156 inhabitants. This is a whale-watching centre, for tourists who want to go out on boats to see sperm whales. Húsavik is also home to energy-intensive industry – a factory that produces silicone metal. This is a shiny, grey semiconduction metal used in the manufacturing of solar panels and microchips. 

The company is owned by the German company PCC which started construction on the factory in 2018, in the middle of the Icelandic financial crisis.

The process involves heating the raw material, quartzite, which comes from a mine in Poland, to 2,000 degrees. The addition of silicon metal makes aluminium alloys strong and lightweight.

The town is 75 kilometres from Akureyri, making it too far away to commute from there. At 22 per cent, the number of foreign citizens is nearly double that of Dalvik, thanks to the tourism sector as well as the very specialised production that PCC is involved with.

Both towns have seen a slight dip in the number of citizens since 2000, but Húsavík has grown in later years. Yet there is a significant shortage of women, especially in Húsavík where there are 89 women for every 100 men.

“Dalvik has already taken a step into the future and enjoys a technological advantage. But this also means that there is an increasing need for IT and process control expertise. A town like Dalvik will always be dependent on the success of one company,” says Grétar Thór Eythórsson.

“But North-Eastern Iceland has seen big change before. There used to be thousands of employees in shoe and textile production in Akureyri, but the industry faltered when the Soviet Union fell. The Russians were big customers. The joke is that Akureyri was the place that was the hardest hit by the fall of Communism,” says Grétar Thór Eythórsson.