The Faroe Islands have the highest employment rate in the Nordic Region and are highlighted as the only Nordic population with fertility rates exceeding replacement levels. The Faroe Islands have advanced seven spots in the Regional Potential Index and have seen an increase in bioeconomy jobs above Nordic average.
Strongest labour force score of all Nordic regions
The report ranks all Nordic regions in the Regional Potential Index, comparing them on a range of demographic, economic and labour force indicators. Oslo tops this year’s index ahead of the other Nordic capital city regions.
The Faroe Islands are ranked 16th out of 66 regions, moving up seven spots since the last ranking in 2018, mainly thanks to a dynamic labour force. The Faroe Islands achieve the highest labour force score of all Nordic regions, boasting the highest employment rates and the lowest youth unemployment rates in the Nordic countries. Looking at the category of rural regions, the Faroe Islands are ranked fifth, behind four regions in neighbouring Iceland.
One of the areas in which the Faroe Islands perform strongly is the bioeconomy. In the period between 2009 and 2017, jobs in the bioeconomy increased by more than 5%, which is among the largest increases amid Nordic regions.
Changing population and job dynamics
According to the report, the Faroe Islands stand out when it comes to the share of jobs at risk of automation. 38.7% of all jobs in the Faroe Islands are considered at high risk of being automated, compared to the Nordic average of 32.1%. Denmark is second at 36.7%, while Norway has the lowest share of jobs at high risk of automation, 29.9%.
At 2.5 births per woman, the Faroe Islands have the highest fertility rates in the Nordic Region. For a population to replace itself in the long run, a total fertility rate of about 2.1 children per woman is necessary, and the Faroe Islands are the only part of the Nordic Region that remains above this level. In general, fertility rates have been decreasing all across the Nordic Region, and quite rapidly in some areas. In Iceland, Norway and Finland, the current birth rates are the lowest ever recorded.
As in Iceland and Greenland, the number of children aged 0-14 in the Faroe Islands still exceeds the number of people aged 65 or over, although the difference has diminished through the years. The Faroe Islands also have a relatively low share of people with a remaining life expectancy of 15 years or less, a group that is likely to require more public services and care than the rest of the population. The proportion in the Faroe Islands is 17.2%, whereas the Nordic average is 21.2%.
Despite these statistics, the ageing of the population is changing the dynamics of the economy and labour market in the Faroe Islands. By 2040, the Faroese working-age population is expected to decrease by 6.6%, which is slightly above the EU28 average of 6.5%.
Lowest share of renewables in energy consumption
While the Faroe Islands have launched a range of ambitious renewable energy initiatives, the share of renewables in gross final energy consumption is still rather small in Nordic comparison. All the Nordic countries have increased their share of renewables in energy consumption between 2004 and 2017, with the largest relative increases in Denmark, 21%, and Sweden, 16%. Renewables now account for 7.5% of the Faroe Islands’ gross final energy consumption, compared to Iceland and Norway with a share of over 70%, Denmark at 36% and Greenland at 19%.