War With U.S. And Israel Pushes Millions Of Iranians Toward Unemployment As Economy Tanks

While sanctions and inflation already battered the Iranian economy before the war with the United States and Israel, a new report has indicated that the conflict has pushed millions of Iranians closer to unemployment and poverty.

An extensive CNN report detailed layoffs and unpaid leave across refineries, textiles, trucking, aviation, and journalism. Iran’s deputy work and social security minister, Gholamhossein Mohammadi, said the war has directly cost about 1 million jobs. CNN noted that Iranian publication Etemad Online estimated another 1 million people have been pushed out of work through spillover effects.

The United Nations Development Programme warned that military escalation is disrupting livelihoods, essential services, and local economic activity across the country. Its analysis said up to 4.1 million more people could fall into poverty, and the country could lose up to one and a half years of human development progress.

“Each day the crisis continues adds pressure on people’s current livelihoods and their futures,” said Beate Trankmann, UNDP deputy regional director for Asia and the Pacific.

Hadi Kahalzadeh, a welfare economist and nonresident fellow at the Quincy Institute, estimated to CNN that 10 million to 12 million jobs, roughly half of Iran’s workforce, are now at risk. He wrote that many firms have suspended operations under “the combined pressure of war, inflation, recession, and collapsing demand.”

Citing reporting from EcoIran, the outlet claimed that more than 23,000 factories and firms have been hit, while Kahalzadeh said damage to steel, petrochemicals, pharmaceuticals, and transport networks has threatened supply chains that support millions of jobs. Trailer-maker Maral Sanat reportedly laid off 1,500 workers because of steel shortages, while Borujerd, one of Iran’s major textile companies, laid off 700.

Inflation has made job losses even harsher. Kahalzadeh said Iran’s point-to-point inflation reached 72% in March, while CNN reported that prices for essentials have risen even faster. Low-income households spend about 45% of their income on food, according to UNDP, leaving them especially exposed to shortages and price spikes.

The internet shutdown has hit women particularly hard. Somayeh, an online German teacher in Isfahan, told CNN that her students can no longer reliably connect to classes. “Nothing works properly anymore,” she said. CNN reported that women have filed about one-third of unemployment insurance claims since the war began.

The government has blamed the hardship on what it calls an unjust war imposed by the U.S. and Israel and is reportedly preparing to expand monthly vouchers for basic goods. But Iranian business leaders are warning that job preservation must become the country’s top economic priority. “The drop in income is bad,” Somayeh told CNN, “but what’s worse is this constant uncertainty. You never know what’s going to happen next.”