Iran faces credibility problem over employment numbers

The high level of unemployment has become a national talking point in Iran, while claimed statistics offered by the government are no longer trusted by citizens.

AFP

Iranian women shop in Tehran on July 18, 2023, as the police relaunched patrols to catch the increasing number of women leaving their hair uncovered in public in defiance of a strict dress code.

Iran faces credibility problem over employment numbers

Hanan Azizi

last update on 04 Aug 2023

The story of unemployment can only be partially told in numbers. Hidden behind claimed figures are real people, suffering from the consequences of joblessness.

In Iran, it is even more difficult to get clarity, because official statistics lack transparency and credibility. Some newspapers, which occasionally shed some light on an otherwise hidden economic and social situation, have recently drawn attention to the problem.

The publication Sharq criticised data issued by President Ibrahim Raisi's government which claimed Iran’s unemployment rate dropped, prompting Minister of Labour Sowlt Mortazavi to claim "the government has achieved its objectives in the employment and labour sector."

His words contrasted with the general feeling in Iran over the jobs market. The newspaper’s report did not endorse the remarks.

It said: “The Minister of Labour claimed that the unemployment rate has fallen below 10% and unemployment has fallen in 24 provinces across the country, a record high in the last decade."

"The government was able to create 720,000 sustainable jobs from summer 2021 to summer 2023. These statements came at a time when the government had pledged to create one million jobs annually.”

Sharq added: "The government and its supporters claim that their policies have led to a decrease in the number of the unemployed, based on the parliament-affiliated Statistical Centre of Iran, which announced in spring of 2023 that the unemployment rate among citizens over 15 years old fell by one percentage point compared to the same period of the previous year and reached 8.2%.

“They also reported that the labour force participation rate rose by 3%, reaching 41.2% over the same period. This is not the first time that government supporters have boasted about the decline in the unemployment rate and called it an ‘achievement’."

"In spring 2023, the Ministry of Labour announced an unprecedented decrease in the unemployment rate in the past 20 years, accompanied by an increase in the workforce, adding that the government had kept its promises.”

Sharq asked: "Why do these claims not match the facts on the ground?"

Hamid Haj Ismaili, an expert in the business sector, has an answer: "Statistics in Iran do not have specialised and accurate conditions and rules. We sometimes find fundamental contradictions between the central bank's statistics and the parliament-affiliated Statistical Centre of Iran, which indicates that the statistical approach in Iran lacks the necessary precision."

“The Statistical Centre of Iran also considers individuals who work two hours per week as part of the labour force, based on the International Labour Organization's definition."

"However, this definition may be valid in other countries, but it does not apply to Iran due to its special circumstances, types of jobs and limited wages. In Iran, the labour force has to work more than ten hours a week in order to be able to make a living.”

In Iran, it is difficult to get clarity about unemployment rates, because official statistics lack transparency and credibility. Hidden behind claimed figures are real people, suffering from the consequences of joblessness.

In an interview with Sharq, he added: "Aside from looking at the statistics to validate the government's claims, we must also ask whether the government was able to develop and implement a feasible plan to create job opportunities. Has the government allocated a budget and resources to increase employment opportunities?

"The answer is, of course, no. Since the start of Ibrahim Raisi's government, the Ministry of Labour has witnessed fluctuations and changes in the position of the Minister of Labour. The Ministry of Labour, which claims to have increased the number of jobs, must answer the question: How did they manage to do it? What was their plan? Without investment projects, no job opportunities can be created.

"The government must clarify which investments it has attracted and in which projects. The country's investment rate has been negative in recent years, and the government was facing a budget deficit and was not even able to secure sufficient budget to implement construction projects."

"We have not witnessed a significant increase in the number in the workforce, because the prevailing government discourse still holds the traditional view of women as mere housewives and not part of the workforce."

In the current conditions and in today's world, this view is outdated and does not match the reality of the society, where unemployment among young people reaches 25%, and among university graduates exceeds 43%."

Meanwhile, the Echo Iran website pointed out that the number of job seekers in Ilam, Kohgiluyeh and Boyer-Ahmad, and Balochistan dropped as people gave up looking for work, taking them out of the statistics.

Jobseekers giving up don't show in the numbers

Zahraa Karimi, an expert in economic affairs, told the same publication: "In some provinces, there is an increase in population, which leads to an increase in the proportion of illegal and informal professions. A significant part of the workforce in these provinces is involved in the smuggling of goods, fuel and drugs, while the proportion of the workforce engaged in legal professions decreases."

An increase in population in some provinces leads to an increase in illegal professions. Many become involved in goods, fuel and drug smuggling to make a living.

Karimi added: "When citizens face difficult living conditions, they cannot remain unemployed for long because they have to work to avoid hunger."

"On the other hand, we have not seen an increase in job opportunities, leading to the spread of marginal occupations such as street vendors, which are more common today than before. We have failed to return to pre-Covid-19 levels in the labour market, indicating that the Iranian economy has not yet recovered from the impact of the pandemic."

AFP — A rug vendor waits for customers in the old market of Iran's central city of Yazd on July 3, 2023.

"The lack of labour productivity is one of the challenges in the country's labour market along with the unemployment rate.

The labour market in Iran is going through unfavourable and difficult conditions, as confirmed by statistics. Around 800,000 jobs were created in 2015 after the signing of the nuclear agreement. Approximately 350,000 jobs were created in 2016, and around 540,000 in 2017.

However, there was a setback in 2018, when the United States withdrew from the nuclear agreement. Iran lost one million jobs in 2020, and only 184,000 jobs were created in 2021, and 269,000 in 2022.

In 2018, when the United States withdrew from the nuclear agreement. Iran lost one million jobs in 2020, and only 184,000 jobs were created in 2021, and 269,000 in 2022.

"The labour force reached about 24.2 million people in 2019, while this figure decreased to about 23.7 million people in 2022. These statistics show that the economy is in trouble. We notice that there is a group trying to produce statistics that do not correspond to reality, but the economic conditions and these indicators are sounding alarm bells."

AFP — Men eat as they sit at a bench in a commercial area in Tehran on February 21, 2023.

Lower wages for women

Karimi pointed out that women usually have fewer job opportunities than men, but that this started to change in 2022, when 137,000 jobs were created for women compared to 132,000 jobs for men, an unprecedented development.

She added: "At first glance, this news may seem good, but given the structure of the Iranian labour market, it can be said that women are often hired for low wages under unsuitable working conditions such as the absence of basic insurance service and the necessary facilities. Women also make up the majority of the informal market."

Women are often hired for low wages under unsuitable working conditions. They also make up the majority of the informal market.

"Many companies, seeking to avoid hiring long-term labour, tend to prefer hiring women, but such a labour market setup is not sustainable for women in the long run. In 2022, the workforce comprised around 20 million for men and 3.6 million for women in 2022."

In April 2022, Kayhan newspaper, which is close to Iran's Supreme Leader, reported: "President Ibrahim Raisi's government has achieved a lot since its inception, as it attempted to shut down many channels of corruption."

The newspaper also emphasised that "the elimination of rentierism, inflation, and economic recession cannot happen overnight as these challenges do not arise today, but are the result of years of accumulation."

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