“The transportation sector will receive 35,000 billion rials [$134.61 million], tourism and handicraft industries 20,000 billion rials [$76.92 million], sports 8,000 billion rials [$30.76 million] and culture and arts will receive 18,000 billion rials [$69.23 million] in financial support dedicated to people and businesses affected by Covid-19 crisis. Applicants need to initiate the process by registering at Kara.mcls.gov.ir,” he was quoted as saying by Mehr News Agency.
Noting that women account for 70% of people who lost their jobs to the virus outbreak, the official said, “According to statistics, 62% of jobholders in recent years are not covered by insurance.”
Out of 533,752 businesses that registered at Kara.mcls.gov.ir and were introduced to the banks to receive government-backed coronavirus financial support, a total of 365,841 businesses (70% of the total) received their loans as of Nov. 30; the documents and collaterals of the rest are under review, the Central Bank of Iran recently reported.
These 365,841 businesses have 620,931 workers on their payroll who were granted a total of 76,933 billion rials ($307 million) worth of loans at the lending rate of 12%.
Following the government’s approval of a 750 trillion-rial ($2.88 billion) package for low-income households and struggling businesses impacted by the coronavirus outbreak and its economic consequences, a total of three million workshops from 14 main groups of businesses and 850 subgroups were identified.
Of these three million workshops, 1.3 million have insurance codes and 1.7 million don’t. These workshops have 2.8 million insured employees and three million uninsured employees.
Public transportation operators, educational centers and beauty salons, women’s clothing shops, gyms, rehabilitation centers for persons with disabilities and not-for-profit schools accounted for the lion’s share of applications submitted to the Ministry of Cooperatives, Labor and Social Welfare for coronavirus loans, the ministry said in October.
Early Estimates
Coronavirus has hit hard an estimated 2.8 million businesses and close to six million jobs in Iran, Alaeddin Azvaji, director general of Policymaking and Job Department of the Ministry of Cooperatives, Labor and Social Welfare, said in August.
“By being hit hard, I mean, these businesses were either forced to close their business or reduce their capacity substantially,” he added.
Early projections by the ministry put the number of jobs at stake at approximately one million, which businesses mainly revolved around Iranian New Year holiday and purchases of spring merchandise. But later in May, the impact of the disease on businesses went deeper and wider.
At first, getting past the coronavirus crash seemed like a V-shaped recovery but then it transformed into a W-shaped recovery, following the second wave of coronavirus in late June. Of course, the second wave was not as severe as the first in March and April.
“The ministry had devised a few scenarios to manage the pandemic’s potential impact on jobs and businesses. Between 50,000-80,000 billion rials [$213-341 million] were needed to carry out these plans. Paying a fraction of small enterprises’ remunerations in the form of ‘income subsidy’ or insurance incentives for the workers of large companies were among our plans to prevent job losses and even help create more employment opportunities,” he told the Persian daily Shargh.
In April, the government announced it would allocate 50,000 billion rials ($192 million) to Unemployment Insurance Fund for supporting those who had lost their jobs amid the outbreak of coronavirus. Applicants were urged to fill out online forms for unemployment benefits at the newly-designed website Bimebikari.mcls.gov.ir, rather than going personally to the ministry’s bureaus.
“The government tried to stimulate minimum demand by handing out loans worth 10 million rials ($38) to households. The second measure was to grant loans to private sector employers, the self-employed and the uninsured. The program included 14 groups, including 880 businesses. This was the first time a mechanism was devised to identify uninsured workers through executive organizations,” Azvaji said.
Studies show unofficial workers, those without health and retirement benefits, are more vulnerable to the crisis. Under the program, individuals who were working at sport clubs, education and services received the government’s coronavirus loans.”
Services Hardest Hit
Fifty-nine percent of all workers who lost their jobs due to the outbreak of coronavirus were service providers, Masoud Babaie, an official with the Ministry of Cooperatives, Labor and Social Welfare, has said.
“Sixty-two percent of businesses affected by the virus were also involved in the services sector. Workers in the industrial and agriculture sectors accounted for 31% and 1% of the jobless due to coronavirus respectively. Nearly 31% and 3% of the virus-affected businesses were in the industrial and agriculture sectors, respectively,” he said.
“Close to 12,500-13,500 people typically file for unemployment benefits annually. However, over 871,400 applied for unemployment insurance following the outbreak of coronavirus by July 31, of whom 730,882 were subject to the three-month relief program. Since then, 107,000 new continued unemployment claims have been registered.”