Long-Term Unemployment Rampant Among College Grads

A large segment of Iran’s workforce is jobless.

A new study shows long-term unemployment at alarming levels, especially among college graduates and women. Although Iran’s economy is improving in the aftermath of sanctions relief and prudent policies by the government, the poor state of businesses has created a jobless host.

Out of the 2.7 million people seeking jobs today, 1.1 million have been searching for over a year to no avail. This is the crux of a study by the High Center for Education and Research on Management and Planning—an organization that operates under the president.

The study analyses data for the second quarter of the 1394 fiscal year that ended March 2016. Jobs data in Iran are scarce and this is one of the few studies dealing with long-term unemployment. The previous study was done by Iran’s chamber of commerce in 1392.

Under the definition of the US Bureau of Labor Statistics, the long-term unemployment category includes those who remain jobless for 27 weeks or more. Most people become discouraged and drop out of the labor force after six months.

The study in question has expanded the time horizon for the definition to over 52 weeks, which lowers long-term unemployment numbers, but makes the numbers more disturbing.

Based on the data, 40% of Iran’s jobless fall into the long-term unemployed category. The ratio is higher among women at 52%, while over a third of jobless men have been searching for work for over a year.

The crisis is more acute among college graduates who are deemed more skilled in general, with 49.2% of unemployed graduates seeking a job for over a year. The figure falls to 33% for those without university degrees.

The whole issue has long been in the making. According to the 2013-14 study, nine out of 10 people that joined the workforce from 2006 to 2011 did not find jobs. The situation has worsened after the 2012-13 financial crisis in Iran, as it further suppressed the job market.

Long-term unemployment can be self-sustaining as it is harder to find a job the longer one is out of work.

These results have far-reaching implications. For one, unemployment among the young is worse, as they comprise a considerable section of Iran’s population. With most state pension funds already in trouble, this mass of jobless people will create havoc for these funds up until their age of retirement.

Also, fertility rates, already falling in Iran, tend to drop off and life expectancy can decline when unemployment rates are high. The repercussions of Iran’s jobs crisis are multi-generational and will plague the Iranian society for years to come.