Iranian President Hassan Rouhani said that “unemployment is the main cause of social problems and creating jobs is a national responsibility.” This came as he addressed the officials of the Ministry of Cooperatives, Labor and Social Welfare on Monday morning.
Rouhani stated that the employment figure in the government has increased to 24 million people from 20.6 million, adding, “We are still far from the number we need.”
The official unemployment rate has reached 27 percent among young Iranians and over 40 percent among university graduates, says Omid Ali Parsai, chairman of the Iranian Statistical Center.
Parsai added that some 550,000 jobs have been created in Iran during the first nine months of the current Iranian year, which started on March 21, 2018. However, the country lags behind in terms of creating employment opportunities, as the projected figure for the number of jobs needed annually is almost 1 million, said the chief statistician, Radio Farda reported.
Reasons for Youth Unemployment
Iran's economy, which is reliant on government initiatives, has very little growth as it is hardly capable of creating new jobs while there is increasing demand for jobs by young job seekers in the market. Still, this is not the only problem.
One of the characteristics of the Iranian government is the discrimination it imposes on the job market. Individuals who at least pretend to be loyal to the Iranian Republic are in a better position to be employed by government employers.
According to international assessments, Iran's job market is inefficient because of widespread discrimination. The biggest employer in Iran is the government, which selects the workforce based on their declared loyalty to the official government ideology. Furthermore, young workers are assimilated into the market at a slower pace, particularly if they are not properly trained and skilled.
Alarming Youth Unemployment
According to official figures, the rate of youth unemployment is more than twice as large as the general unemployment rate. Such a high unemployment rate is usually indicative of a crisis in the job market.
Employment depends on many macro-economic variables such as economic growth, short term and long term investment and the production capacity of various work places.
Based on the latest figures by the Iranian Statistical Center, during the first half of the current year, the rate of investment and economic growth have had a free fall in the areas of industry and agriculture. There has also been a sharp decline in production particularly in the automobile manufacturing sector.