News and articles
The Chicken or the Egg?
There are worrying signs in the economy, and all indications suggest that the assumptions underlying the collective agreements will fail this autumn. Inflation has been rising, unemployment has increased, and interest rates have gone up. The drivers of inflation are many and its composition is complex, but if progress is to be made in the fight against it, it is important to increase understanding of its nature and causes.
We Demand That the Banks Reverse Their Interest Rate Hikes
VR, LÍV and the Fagfélögin condemn the interest rate hikes announced by the commercial banks before the weekend.
The commercial banks reported close to ISK 100 billion in profit after taxes last year. That amounts to more than ISK 320 thousand for every adult in the country. There is room for manoeuvre there, and there lies the banks’ social responsibility. The banks should shoulder part of the burden caused by the economic situation.
Interest rates rise and everyone profits – except you
At the same time as the Central Bank raises interest rates because of persistent inflation, the figures from the banks’ quarterly financial statements are published. The combined profit of the commercial banks and Kvika amounts to just under ISK 30 billion. Profits have increased by one third year-on-year and net interest income by 29%. These headlines have all but stopped surprising people. In February this year, reports showed the banks’ combined profit in 2025 amounted to almost ISK 100 billion, or around ISK 320,000 for every adult Icelander. A year earlier, news broke of ISK 88 billion in profits in 2024. Of course, banks profit when interest rates are sky high.
Changes to Preschools Call for Changes to Working Hours
The results of a new VR survey show that changes made at the preschool level have had a major impact on the daily lives of many families within the union. The survey also shows that the financial situation of parents is, in many cases, difficult — around one-third of respondents say their household finds it difficult to make ends meet.
Companies and the government – it’s your move
International Workers’ Day has arrived! All over the world, wage earners gather, celebrate past victories and sharpen their demands for the future. Here in Iceland, rallies are being held across the country where wage earners demonstrate the power of solidarity. It is clear that the state of economic affairs will be high on the agenda. Collective agreements are likely to unravel this autumn due to persistent inflation, which is largely a domestic problem. Housing plays the biggest role, but there are also clear signs of profit-driven inflation, meaning that companies are taking advantage of the situation to raise prices excessively and thereby increase their profits.
We demand!
VR, LÍV and Fagfélögin have joined forces and are addressing the government, the municipalities and companies in the country in a new campaign. All signs indicate that collective agreements may unravel this autumn, with unpredictable consequences. Wage earners have borne the brunt of persistent inflation, high interest rates and rising unemployment. Everything keeps getting more expensive – and wage earners cannot keep up.