The harsh climate in Iceland has formed a perfect source of demand for warm, cheap clothes here. That it was urgent to knit a lot of new clothes before the age of massproduced clothings, and darn and mend on those you already had so they could be used over again is understandable. If you didn’t – you’d most certainly die a gruesome death by frostbites. This can be depicted in the old traditional Icelandic songs, where they sing about the importance of working those knitting needles and crochet hooks – or else you die. The most famous one is a Christmas/Yule (Isl. “jól”)- song about the Yule cat (Isl. “Jólakötturinn”).
The song is about the Yule Cat that will eat those who do not get a new pair of clothes for Yule. It may sound strange that the deprived ones will also become the ones who get killed (Christmas songs in general tend to be more jolly and cheerful), but this song is just about how the economic circumstances were during this time – you needed to finish all work with the autumn wool before Yule. The Yule was celebrated during that time when it started to get really cold outside and if you didn’t finish, you wouldn’t have anything to shield yourself with from the biting cold. Thus the Yule Cat was used as an incentive to get people to work harder (or as a metaphor for the cold that will come and bite you, sc. frostbite).
 “Yule” is the English translation of the pre-Christian midwinter celebration, jól, which was a part of the Old Norse religion – Ásatrú or Forn Siðr. The terms are nowadays, colloquially, used interchangeably (sadly though).