Cooperatives Ministry Reviews Youth Labor Market Conditions

EghtesadOnline: Twenty-five percent of youth householders (those between 15 and 25 years) fell into the first income decile (those with the lowest income) in the year ending March 2020, Welfare Department of the Ministry of Cooperatives, Labor and Social Welfare reported the data cited by the ministry’s Center of Statistics.

News ID: ۷۸۶۳۶۵

18 April 2021

Iran’s youth population has decreased from 20% in the year ending March 2012 to 14.8% in the year ending March 2017 to 13.4% in the year ending March 2020. The youth population is expected to rebound from the year ending March 2022 for a period of 15 years.

Over the past decade, youth unemployment hovered around the alarming rate of 25%; in the year ending March 2017, it even reached 30%. The share of workforce in general and young workforce in particular has been on a downtrend in industrial and agricultural sectors.

However, the share of services sector with jobs characterized as part-time and having low job security (temporary contracts, etc.) went up by nearly 10% from 38% to 47%.

Unemployment of university graduates seems to be one of the factors discouraging young people from pursuing higher education. Statistics show the share of young university graduates has declined from 27% in the year ending March 2016 to 25% in the year ending March 2020.

Higher education graduates’ unemployment per capita was 150 in 100,000 people in the year ending March 1987; 850 in the year ending March 2007; and more than 2,100 in the year ending March 2017.

Notably, higher education graduates per capita increased from 2,700 in 100,000 people in the year ending March 1987 to 10,000 in the year ending March 2007 to 18,000 in the year ending March 2017.

The share of youth in official jobs (only those with the Social Security Organization’s insurance) has been declining over the past decade as well, dropping from 83.5% in the year ending March 2012 to 77.5% in the year ending March 2020. However, the share of women from official jobs increased by six percentage points from 17% to 23%.

The uneven distribution of young householders among income deciles has been one of the key outcomes of high youth unemployment and their unofficial employment. In the year ending March 2020, 25% of families young breadwinners fell into the first income decile, 55% fell in the top three low-income deciles and less than 1% fell in the 10th income decile (those with the highest income).

SCI’s Q4 Report

Iran’s unemployment rate, the proportion of jobless population of ages 15 and above, stood at 9.7% in the fourth quarter of the last Iranian year (Dec. 21, 2020-March 20), indicating a 0.9% decline compared with the same period of the year before.

According to the latest report of the Statistical Center of Iran, a total of 2,477,850 Iranians were unemployed in Q4. Men’s unemployment stood at 8.4% while the rate for women hovered around 16.5%. Over 1.79 million men and 685,934 women of ages 15 and above were jobless in Q4 during the period.

The unemployment rate was 10.2% for urban areas (1.96 million people) and 8% for rural areas (508,580 people).

SCI put Q4 labor force participation rate—the proportion of the population of ages 15 and above that is economically active either employed or looking for job—at 40.9% or 25.61 million people, registering a 1.5% decrease year-on-year.

Men’s and women’s economic participation rates were 68.5% and 13.3% respectively in the same period.

SCI reports that 21.44 million men and 4.16 million women of ages 15 and above were economically active in Q4, i.e., they were either employed or looking for a job.

The center provides two figures for the youth unemployment rate: the proportion of the 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 23.6% in Q4, posting a 2.1% decrease while the unemployment rate of those between 18 and 35 years stood at 16.8%, posting a decline of 1% YOY.

Underemployment, the condition in which people in a labor force are employed for less than 44 hours of service per week, stood at 10.8%, up 0.4% year-on-year and was higher for men and those living in rural areas.

The Q4 underemployment rate for men and women stood at 11.9% and 4.6%, respectively, while it was 9.4% for urban areas and 14.9% for rural areas.

The unemployment rate for university graduates stood at 14.1% in Q4, posting a 1.5% decrease YOY. Higher education unemployment rate for men stood at 10% and that of women was around 23.5%.

The share of higher education unemployment from the total unemployed population was 38.8% in Q4, which indicate a decrease of 0.2% year-on-year.

The unemployment shares of male and female graduates from the total unemployed population stood at 26.4% and 71%, respectively, while the share of higher education unemployment from the total unemployed population was 42.6% in urban areas and 24.1% in rural areas during the period.

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.

The total Q4 employment rate was 36.9% (23.13 million), down 0.9% compared with the same quarter of the previous Iranian year. Employment rates for men and women were 62.8% and 11.1%, respectively, which constituted 19.65 million men and 3.48 million women in Q4.

The employment rate was 36% or 17.28 million in urban areas and 40.1% or 5.84 million in rural areas.

The share of employment of university graduates stood at 25.3% of the total employed population, wherein male and female graduate employment was 21.7% and 45.4%, respectively. Graduate employment rates in urban and rural areas stood at 31.1% and 8.1% of the total population of job-holders.

Q4 statistics show that 33.9% of the country’s labor force worked more than 49 hours per week, indicating a 1.4% decrease over the same period of last year.

The services sector employed 50.4% of the Iranian employed population (11.66 million), 2.3% less than the corresponding period of last year, whereas industrial and agricultural sectors provided 33.8% and 15.8% of jobs respectively.

Over 7.81 million were employed in the industrial sector, indicating an increase of 2.1% compared with the same period of the year before and 3.65 million worked in agriculture, posting a 0.2% increase YOY.

The services sector consists of wholesale and retail trade; restaurants and hotels; transport, storage and communications; financing, insurance, real estate and business services; as well as community, social, education, health and personal services.

The services sector employed 9.67 million men and 1.99 million women in the three-month period; over 6.88 million men and 927,211 women were working in the industrial sector and 3.09 million men and 562,828 women worked in the agriculture sector in Q4.

Services sector accounted for 59.2% or 10.23 million of all jobs in urban areas and 24.4% or 1.42 million of jobs in rural areas.

The industrial sector made up 34.9% or 6.04 million of the jobs in urban areas and comprised 30.3% or 1.77 million of employment in rural areas. This is while 5.8% or one million of the total jobs in urban areas and 45.3% or 2.64 million of the jobs in rural areas were in the agriculture sector.