Need for Jobs and Workable Gov't Measures in Iran

EghtesadOnline: Job creation is not within the direct purview of the government, yet it was one of the main topics in the presidential election debates last month.

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17 June 2017

Both analysts and senior government authorities in the recent past have been cited as saying that creating work for the army of unemployed is "not the duty of the government." Political opponents of the government insist otherwise.

They often castigate the administration for "not doing enough" to create jobs, especially for the increasingly large numbers of young people coming out of universities and centers of higher learning.

Mehdi Nosrati, an economist, in an editorial for the Tribune's Persian-language sister newspaper, Donyaya-e-Eqtesad, has reflected on the long-drawn-out issue of joblessness that has indeed emerged as the Achilles heel of the government, Financial Tribune reported.

He believes that the role and responsibility of the government is plain but not simple. “It includes provision of public goods, managing externalities, and improving the distribution of income.”

“Ride-hailing application companies namely Snapp and TAP30 which have more than 100,000 employees in Tehran alone are visible examples of the influential role of the government in job creation. Did the government create these jobs? No. Did the government play any role in the creation of these jobs? Yes, and that was through facilitating infrastructure, improving internet performance and providing economic freedom.”

Nosrati called for workable measures by the government to help the market, private sector and entrepreneurs put people on the pay roll. "Controlling inflation , creating a stable economic environment for investment and trade, improving economic freedom, reducing the bloated bureaucracy, eliminating rent-seeking and getting rid of monopolies can and should facilitate job creation."

Moreover, by providing suitable infrastructure for high-speed internet, energy, transportation, banking and financial operations, and improving international relations to promote trade and foreign investment as well as portraying a positive image of the country as a safe business and investment destination, the government can create proper conditions for more employment.

Senior presidential advisor, Masoud Nili, says the government of President Hassan Rouhani is among the world’s top five in generating an annual average of 704,000 jobs. “But this extraordinary feat has gone unnoticed because of the sharp increase in the number of job-seekers,” he has been quoted as saying.

Iran’s unemployment rate in the last fiscal year (ended March 2017) stood at 12.4%, registering a 1.4% rise compared with the year before, according to the Statistical Centre of Iran. The SCI data show 3.2 million people were unemployed and that 10.5% of men (or 2.19 million) and 20.7% of women (or 1.01 million) of ages 10 and above were jobless during the period.

Unemployment rate was 13.7% for urban areas and 8.9% in rural regions. Joblessness was higher among women compared to men and among those living in urban areas. The youth unemployment rate, i.e. the proportion of the population between the ages of 15 and 29, stood at 25.9%, posting a 2.6% rise year over year.