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01 / 05
Icelanders Turn $12 Cod into $3,500 Worth of Products

Blog Post | Adoption of Technology

Icelanders Turn $12 Cod into $3,500 Worth of Products

The export value of Icelandic cod has increased 100 percent in the same time that the annual catch has fallen by 45 percent.

Iceland's Profitable Cod

Something odd has happened to Iceland’s fisheries. In Icelandic waters, cod numbers have hit a historic high. But rather than taking advantage of this bountiful fishing opportunity, the annual catch has decreased by 45 percent since 1981. Over the same period, the total export value of Icelandic cod products has increased by more than 100 percent. The cause of this peculiar and seemingly contradictory trend is partly explained by Iceland’s Ocean Cluster House or what is commonly referred to as the “Silicon Valley of White Fish.”

Overlooking Reykjavik’s harbor, Ocean Cluster House is home to 120 new marine start-ups, all of which are focused on “100 percent fish utilization.” In other words, they are businesses developing ideas that use fish meat, oil, skin, bones and intestines, to draw value out of produce that would otherwise be trashed. “From one cod we can maybe get $12 for the fillet. But if we use the whole round we can get $3,500 for each cod,” explains Ocean Cluster’s founder, Thor Sigfusson. The “value-added approach challenges the notion that a fish’s primary purpose is a fillet,” he notes.

Sigfusson objects to those who believe that “fisheries around the world need more fish to catch.” Instead, he argues that fishermen must reduce waste by utilizing the 55 to 60 percent of the fish that currently remains unused. Thanks to human ingenuity “you can do more with less,” Sigfusson explains. Here are just some of the innovative ideas that are revolutionizing the Icelandic fishing industry and proving human ingenuity can add value to previously unutilized materials and processes:

  • Penzim – a gel product made with enzymes from fish intestines; softens and heals damaged skin, and eases joint pain.
  • Alda – a lemon-flavored health drink developed using marine collagen.
  • Dropi – transformed smelly cod liver medicine into a freshly squeezed luxury good Omega 3 supplement.
  • Kerecis – makes medical bandages from cod skin. Treats wounds, burns and other tissue damage – including treating diabetic foot wounds that could otherwise become infected, resulting in amputation.
  • Omega3 Pectus – Kerecis is also working on a product to be used in breast reconstruction, replacing the nylon support string, with fish skin.
  • Reykjavik Foods – making canned fished into a luxury good by adding truffles and high-end packaging.
  • Dried fish heads, and fish carcass lamps – Ocean Cluster House sells dried fish heads for $8 in their souvenir shop, serving the niche tourist market.
  • Fish jerky – the onsite store now sells this unique type of jerky.
  • Feel Iceland – a company focusing on anti-aging cosmetic products made with marine collagen and enzymes.
  • The Cherry Tree – an art and design store selling clothing and accessories made from fish skin, including bags, belts and bowties.

Ocean Cluster House has begun to spread these efficiency-enhancing practices globally and has its eyes on North American markets, where it is currently estimated that between 40 percent and 47 percent of edible seafood is wasted. Iceland now utilizes 80 percent of each cod that is caught.

Change seen in the Icelandic fishing industry is just one example of the pioneering ways that human ingenuity can create more jobs and add greater value while using fewer or previously unutilized resources. As humanity becomes more educated, interconnected and innovative, other sectors are likely to undergo similar changes, making all of our lives more prosperous.  

Bloomberg | Labor Productivity

Chick-Fil-A’s Lemon-Squeezing Robots Save 10,000 Hours of Work

“In a plant north of Los Angeles, machines now squeeze as many as 1.6 million pounds of the fruit with hardly any human help. The facility, larger than the average Costco store at roughly 190,000 square feet, then ships bags of juice to Chick-fil-A locations, where workers add water and sugar to whip up the chain’s trademark lemonade.

The automated plant frees up in-store staff to serve customers faster, according to the company. Squeezing lemons was a tedious task that added up to 10,000 hours of work a day across all locations and resulted in many injured fingers.”

From Bloomberg.

Wall Street Journal | Labor Productivity

The American Worker Is Becoming More Productive

“Productivity in the U.S., as measured by how much the average worker gets done in an hour, has been on the rise. That matters because the faster that productivity grows, the faster the economy can grow as well. The success of the U.S. economy, and why it has grown so much compared with other countries over the past century and more, has hinged on its productivity. 

Productivity—the total output of the economy divided by hours worked—rose 2% in the third quarter compared with a year earlier, according to the Labor Department. That marked the fifth quarter in a row with an increase of 2% or better. In the five years before the pandemic, there were only two such quarters.

The gains in part reflect massive changes in the U.S. economy since the onset of Covid-19. Companies learned new ways of doing things and adopted new technologies, while an upheaval in the labor market moved workers into more productive jobs.

Another big change in the American labor force—a massive influx of immigration—might also have played a role. Immigrants are often slotted into manual-intensive jobs, which could allow other workers to move up to more highly skilled jobs.”

From The Wall Street Journal.

Reason | Employment

Amazon Warehouses Benefit Local Economies, Study Finds

“In a newly-released research paper, Evan Cunningham, a Ph.D candidate in Economics at the University of Minnesota, studied the effects of Amazon’s continued spread across the country—growing from just a handful of warehouses, or ‘fulfillment centers,’ in 2010, to more than 1,300 today in the U.S. alone. On balance, it turns out that Amazon warehouses provide a net positive to local economies.

‘I find Amazon’s entry in a metro [area] increases the total employment rate by 1.0 percentage points and average wages by 0.7 percent,’ Cunningham writes. ‘The composition of employment shifts from retail and wholesale trade to warehousing and tradeable services, primarily driven by younger workers. Employment gains are concentrated among non-college workers.'”

From Reason.

National Bureau of Economic Research | Labor Productivity

Robots and Labor in Nursing Homes

“How do employment, tasks, and productivity change with robot adoption? Unlike manufacturing, little is known about these issues in the service sector, where robot adoption is expanding. As a first step towards filling this gap, we study Japanese nursing homes using original facility-level panel data that includes the different robots used and the tasks performed. We find that robot adoption is accompanied by an increase in employment and retention and the relationship is strongest for non-regular care workers and monitoring robots. The share of specific tasks performed by robots increases with the adoption of the respective type of robot, leading to reallocation of care worker effort to ‘human touch’ tasks that support quality care. Robots are associated with improved quality (reduction in restraint use and pressure ulcers) and productivity.”

From National Bureau of Economic Research.