Iceland vs Luxembourg

Compare PPP-adjusted average wages, long-term wage trends and consumer price levels using consistent OECD data.

Country A

Country B

Wage data: 2025 · Price data: 2024

Comparison Overview

Iceland

Average wage (2025)

$100,605

1-year change: +1.8%
5-year change: +21.6%

Overall price level (2024)

112 (United States = 100)

Iceland's latest PPP-adjusted average wage is approximately 2.1% higher than Luxembourg's.

Luxembourg

Average wage (2025)

$98,530

1-year change: +1.1%
5-year change: +8.3%

Overall price level (2024)

96.6 (United States = 100)

Iceland has the higher latest average wage of the two, by 2.1% on a PPP-adjusted basis. Over five years Iceland shows the stronger change (+21.6% against +8.3%). Overall consumer prices are higher in Iceland, at 112 against 96.6 on the United States = 100 scale — a gap of +15.4 index points. Both wage figures are for 2025 and the price levels for 2024, so the two economies are read at the same point in each series.

Wage History

See how PPP-adjusted average annual wages have changed in both economies.

PPP-adjusted annual wage (USD)

IcelandLuxembourg

USD PPP, constant 2025 prices

Wage Key Facts

Metric	Iceland	Luxembourg
Latest wage	$100,605	$98,530
Latest year	2025	2025
1-year change	+1.8%	+1.1%
5-year change	+21.6%	+8.3%
10-year change	+34.6%	+11.0%
Historical peak	$100,605	$98,530
Peak year	2025	2025
Change from peak	0.0%	0.0%

How the Wage Trends Compare

Current Position

Iceland records the higher figure: $100,605 against $98,530, a gap of 2.1%. The gap is clear enough to rank the two, though it says nothing about how the figure is distributed within either economy.

Both figures are for 2025, so this is a like-for-like comparison of the same year rather than of two different latest points.

Both use the same basis: PPP-adjusted US dollars at constant prices. That conversion strips out the price level differences between the two economies, which is what makes the two figures comparable at all — neither is a local-currency salary, and neither is what an employer in that country would write on a contract.

Recent Momentum

Iceland had the stronger latest year (+1.8% against +1.1%).

Both moved up in the latest year, which leaves the ordering between them unchanged.

Widening the window to five years, the stronger of the two is Iceland: +21.6% against +8.3%.

For both economies the latest year points the same way as the five-year change, so the recent movement reads as continuation rather than a turn.

Long-Term Direction

Across ten years both series are up — +34.6% for Iceland and +11.0% for Luxembourg. Over this horizon the two share a direction, and the difference between them is one of pace.

Both are at their historical peaks in the latest year, so neither series is currently below a previous high.

Consumer Price Level Comparison

Compare eight consumer price categories with the United States benchmark of 100.

United States = 100
Missing values are shown as -

All differences are shown in index points. United States = 100.

Category	Iceland	Luxembourg	Difference (ISL − LUX)	ISL vs U.S.	LUX vs U.S.
Overall	112	96.6	+15.4	+12.0	−3.4
Food	127	106	+21.0	+27.0	+6.0
Clothing	129	99.7	+29.3	+29.0	−0.3
Housing	91	99.4	−8.4	−9.0	−0.6
Health	99.9	77.1	+22.8	−0.1	−22.9
Transport	144	101	+43.0	+44.0	+1.0
Recreation	128	97.1	+30.9	+28.0	−2.9
Restaurants & Accommodation	134	101	+33.0	+34.0	+1.0

Overall
Iceland112
Luxembourg96.6
Difference+15.4
ISL vs U.S.+12.0
LUX vs U.S.−3.4
Food
Iceland127
Luxembourg106
Difference+21.0
ISL vs U.S.+27.0
LUX vs U.S.+6.0
Clothing
Iceland129
Luxembourg99.7
Difference+29.3
ISL vs U.S.+29.0
LUX vs U.S.−0.3
Housing
Iceland91
Luxembourg99.4
Difference−8.4
ISL vs U.S.−9.0
LUX vs U.S.−0.6
Health
Iceland99.9
Luxembourg77.1
Difference+22.8
ISL vs U.S.−0.1
LUX vs U.S.−22.9
Transport
Iceland144
Luxembourg101
Difference+43.0
ISL vs U.S.+44.0
LUX vs U.S.+1.0
Recreation
Iceland128
Luxembourg97.1
Difference+30.9
ISL vs U.S.+28.0
LUX vs U.S.−2.9
Restaurants & Accommodation
Iceland134
Luxembourg101
Difference+33.0
ISL vs U.S.+34.0
LUX vs U.S.+1.0

Iceland and Luxembourg in Detail

Current Wage Position

Iceland reports a PPP-adjusted average annual wage of $100,605 for 2025, and Luxembourg $98,530 for 2025. That puts Iceland ahead by 2.1%.

Both figures are PPP-adjusted: converted using purchasing power parities rather than market exchange rates, and expressed in constant prices so different years stay comparable.

This matters for reading the gap. A market-rate conversion would move with currency markets and would not reflect what the money buys in each economy. These figures are built to compare purchasing power, not to tell you what a currency transfer would be worth.

Recent Wage Momentum

In the latest reported year Iceland changed by +1.8% and Luxembourg by +1.1%. A single year is a narrow window, so it is worth reading alongside the five-year figure rather than on its own.

Over five years, Iceland records the larger change at +21.6%, against +8.3% for Luxembourg. That is the difference in how far each series has travelled over the medium term, in real PPP-adjusted terms.

Short-term and five-year movement point the same way for both economies, so neither is currently being pulled against its own medium-term direction.

Long-Term Wage Direction

Across ten years the changes are +34.6% for Iceland and +11.0% for Luxembourg. This is the longest horizon the data covers, and it is the one least affected by any single year's movement.

Iceland reached its highest recorded value of $100,605 in 2025, and the latest figure sits 0.0% from that high.

Luxembourg peaked at $98,530 in 2025, leaving its latest value 0.0% away from that point.

Both long-term series move the same way, so the difference between these two economies is one of degree over ten years rather than of direction.

Consumer Price Profile

Against the United States benchmark of 100, overall consumption sits at 112 in Iceland and 96.6 in Luxembourg — +15.4 index points apart.

The categories that separate them most are Transport (+43.0) and Restaurants & Accommodation (+33.0).

Housing is where they are nearest, at 91 and 99.4.

Across the categories with data, Iceland is the more expensive of the two more often than not.

How to Interpret the Comparison

These are average wages, not median wages, and not take-home pay. An average is pulled by the whole distribution, so it does not describe a typical individual, occupation, city or employer in either economy.

The wage figures are already PPP-adjusted and in constant prices. They are not local-currency salaries and not amounts convertible at a market exchange rate.

The price levels are relative indices against United States = 100. They describe how price levels compare, not what a household actually spends.

Wages and price levels should not be combined into a verdict on which country is better. This page is for understanding how the two wage trends and price structures differ — nothing further follows from it.