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The ongoing conflict involving the US and Israel has plunged Iran into a severe economic crisis, resulting in staggering job losses across multiple sectors. According to Gholamhossein Mohammadi, the Deputy Minister of Work and Social Security, approximately two million Iranians have lost their jobs due to the war. This alarming figure reflects a broader trend of redundancies that have become a focal point of discussion among citizens, particularly on social media platforms.
Impact of the Conflict on Employment
The recent wave of lay-offs has escalated discussions in Iranian households and online forums. Employers and government officials typically describe these job cuts as a necessary measure to “balance the workforce.” However, the reality is far more dire. Factories that have been directly targeted by air strikes are not the only ones affected; entire supply chains, retailers, and even the burgeoning digital sector are experiencing significant disruptions.
Social media users are vocal about the visible signs of this crisis. One user remarked on the noticeable emptiness in public transport, while another pointed out the abundance of parking spaces near workplaces. Commuters have reported that once-crowded highways are now eerily quiet, illustrating the dramatic decline in workforce mobility.
Declining Consumer Spending
Consumer behaviour has also shifted dramatically, with many individuals now prioritising basic necessities over luxury items. This has led to a downturn in sectors such as tourism and dining, further exacerbating the economic challenges faced by the nation. Retailers not dealing in essential goods are particularly vulnerable, as consumer confidence plummets.
Compounding this issue is the Iranian government’s decision to impose an internet blackout since the outbreak of hostilities, which has severely impacted the tech and digital sectors. Officials justify this measure as a security precaution to mitigate risks of espionage and cyber-attacks. However, the blackout has not only stifled communication but has also hampered the ability of businesses, especially those reliant on online platforms, to operate effectively. In January, Iran’s Communications Minister, Sattar Hashemi, estimated that each day of internet disruption costs the economy around 50 trillion rials (approximately $35 million). The cumulative loss over the past 52 days has surpassed $1.8 billion.
Women and Job Losses
The ramifications of the conflict have been particularly harsh for women in the workforce. Despite already facing significant barriers, only one in nine working-age women in Iran were employed prior to the war. Many relied on social media platforms like Instagram to connect with customers and sell their products. The internet shutdown has effectively erased their means of livelihood, pushing them further into economic uncertainty.
Media organisations have not been immune to the fallout either. Notably, the Iran Labour News Agency (Ilna) recently dismissed all its journalists, opting instead to engage them as freelancers. This trend of downsizing underscores how widespread the job losses are, reaching even sectors where demand for coverage has surged due to the conflict.
Economic Consequences of the War
The direct impacts of military strikes have been felt across key industries, including petrochemicals and steel manufacturing. In late March and early April, air strikes targeted significant facilities, resulting in immediate job losses for tens of thousands. Furthermore, the ripple effect has extended to countless other firms that supply or rely on these industries for materials.
A manufacturing executive from Qom highlighted the ongoing struggle to maintain operations due to shortages of essential materials, stating, “We hoped for a return to normalcy once the conflict ceased, but we cannot even secure shipments due to concerns over access to Iranian waters.” Reports have surfaced of companies laying off staff with the promise of potential re-employment once conditions improve, while others are compelling employees to take unpaid leave as a stop-gap measure.
The Iranian government has introduced a loan scheme aimed at small businesses, offering financial support of 440 million rials (under $300) per worker. However, this initiative comes with stringent repayment terms and interest rates ranging from 18% to 35%, creating additional burdens for struggling enterprises.
Why it Matters
The economic upheaval in Iran represents a critical juncture for millions of citizens already grappling with soaring inflation, which surpassed 50% in March 2026. The potential for increased unemployment and rising prices looms large, suggesting that the current crisis may deepen if the conflict escalates or if sanctions remain in place. The interplay of military action and economic instability could lead to unprecedented hardship for the Iranian populace, making it imperative for stakeholders to seek diplomatic resolutions to avert further deterioration of the situation.