Labour market and industries
In the beginning of the 1990s the Faroes went through a severe economic crisis. The resulting mass unemployment peaked at 26% in 1994, but after this date fell steadily to about 10% in 1996. For many years the unemployment rate has been below 5%, and even as low as 1.4%. The international financial crisis may be the reason for a relatively small increase to 2.3%.

The fishing industry
Together with the fish processing industry, the fishing and offshore aquaculture industries are the largest employers with around 4,400 employees. In addition are related industries like shipyards and trade companies.

The fishing fleet consists of some 150 vessels, mainly coastal vessels and long-liners as well as a number of ocean-going trawlers. Faroese fishermen fish within their own 200-mile exclusive fisheries zone and also have access to fisheries in other zones and international waters. The majority of the hauls in Faroese waters are landed on the islands for further processing. In 2007, the total catch was 121,100,000 tons, of which 10.6% was cod, 12.9% haddock, 45.7% coal fish or saithe and 33.1% other species such as halibut, redfish, herring and mackerel.

The offshore aquaculture industry was started up in the early 1970s with the rearing of rainbow trout and later Atlantic salmon. There has been increasing interest in producing other farmed species, with the first successful rearing of white halibut in 2001. There is a fish farm in almost every suitable bay and fjord.

Agriculture
Until the middle of the 19th century agriculture was the main occupation, and sheep farming has always been the most important farming activity. Until the middle of the 20th century the main aim of sheep farming was to produce good quality wool for export and meat for domestic consumption. Geographical conditions set limits for the number of grazing sheep, and today, as in the past, the limit is around 70,000 sheep with a yearly meat production of around 5,000 tons. The Faroe Islands now also have dairy cattle and pig farms.

However, the islands' food production is not big enough, and in 2008, the import of various food products was around DKK 1.6 billion.

Non-renewable resources
In 1992 the Danish government handed over to the Faroese government the rights to the non-renewable resources potentially found in the subsoil. Since oil resources have been discovered in British territorial waters close to the Faroese continental shelf, there are hopes that oil resources will also be found within the Faroese territory. Although there are indications that the subsoil holds significant volumes of oil, it is as yet unclear whether the quantities are sufficient to sustain future commercial oil production.

The licence conditions require the participating companies to co-operate actively with Faroese industry to improve its competitive ability to deliver goods and services to the petroleum activities. The Faroese Earth and Energy Directorate, Jardfeingi, is responsible for all administrative tasks related to oil exploration and production activities in the Faroe Islands.