Incentive Plan Created 6,752 Jobs for First-Time Workers

EghtesadOnline: The “salary subsidy scheme” generated 6,752 jobs for first-time workers in the last fiscal year (March 2019-20).

News ID: ۷۵۱۱۰۶

27 September 2020

The Ministry of Cooperatives, Labor and Social Welfare implemented this incentive plan in eight Iranian provinces, namely Ilam, Kurdestan, Chaharmahal-Bakhtiari, South Khorasan, Kermanshah, Lorestan, Sistan-Baluchestan and Kohgilouyeh-Boyerahmad, during the year ending March 19, 2020, based on which the ministry pledged to pay 30% of the minimum wage to first-time employees who recently graduated from universities for the first 12 months to their employers.

Each employer or entrepreneur of the private or cooperative sector, particularly those of knowledge-based enterprises and startups, and businesses that received a green badge from the Iranian Department of Environment or accolades from national festivals of entrepreneurship or Resistance Economy Command Headquarters, could apply for this scheme for 50% of their insured workforce.

The scheme requires employees to be between 20-30 years of age and without prior insurance coverage for three months or more. However, the age requirement does not apply to jobless female breadwinners.

According to a report by Mehr News Agency, a total of 1,714 economic enterprises participated in this plan in the last fiscal year. Each enterprise employed 4.8 first-time workers on average.

At first, the ministry set the goal of providing jobs for 5,000 people via the salary subsidy scheme, but the figure increased to 6,752 people, of whom 462 people were heads of households.

Lorestan and Kurdestan accounted for the highest and lowest number of employee per enterprise with 9.7 and 2.1 people respectively.

Enterprises with more than 50 workers in the industrial sector and businesses with 10-49 employees in the services sector had the highest capacity to attract the highest number of first-time workers.

If sponsored, the scheme will be carried out in 16 underprivileged and border provinces in the current year (March 2020-21). A total of 16,000 first-time jobbers are expected to be employed over the years ending March 2021 and 2022.

Iran's Labor Marker in Review

Iran’s unemployment rate, the proportion of jobless population of ages 15 and above, stood at 10.7% in the last Iranian year (March 2019-20), indicating a 1.5% decline compared with the year before, the latest report by the Statistical Center of Iran shows.

Labor force participation rate—the proportion of the population of ages 15 and above that is economically active either employed or looking for job—stood at 44.1%, registering a 0.4% decrease year-on-year.

Employment is defined as persons of working age engaged in any activity to produce goods or provide services for pay or profit, whether at work during the reference period or not at work due to a temporary absence from a job, or to working-time arrangement.

Last year’s total employed population was 24.27 million, nearly 430,000 more than the year before.

The services sector employed 50.3% of the Iranian employed population last year, whereas industrial and agricultural sectors provided 32% and 17.7% of jobs, respectively.

The center provides two figures for youth unemployment: the proportion of population between 15 and 24 years and those between 18 and 35 years.

The youth unemployment rate of those between 15 and 24 years stood at 26%, posting a 1.7% decrease while the unemployment rate of those between 18 and 35 years stood at 17.9%, posting a decline of 1.7% YOY.

Underemployment, the condition in which people in a labor force are employed for less than 44 hours of service per week, stood at 9.9% while 38% of the country’s employed population worked more than 49 hours per week.

SCI's latest report on Iran's labor market shows the proportion of jobless population of ages 15 and above, stood at 9.8% in the first quarter of the current Iranian year (March 20-June 20), indicating a 1.1% decline compared with the same period of last year.

A total of 2,505,336 Iranians were unemployed in Q1.

Men’s unemployment stood at 9% while the rate for women hovered around 13.7%.

Over 1.9 million men and 602,074 women of ages 15 and above were jobless in Q1.

The unemployment rate was 10.7% for urban areas (2.03 million people) and 7.3% for rural areas (472,634 people).