Iran’s wartime economic crisis has triggered mass layoffs across multiple industries, with Iranian officials estimating that some two million people have lost work “directly or indirectly” due to the conflict and a prolonged nationwide internet blackout, according to a report by The New York Times.
Businesses across Iran have begun laying off workers as the country’s economy struggles under the combined pressure of war-related disruptions, sanctions, infrastructure damage, and the government-imposed internet blackout.
Iranian Deputy Labor Minister Gholamhossein Mohammadi said the conflict had already resulted in the loss of more than one million jobs and left another two million people “directly or indirectly unemployed,” according to statements given to Tasnim.
“A strange and overwhelming vortex of economic problems has emerged, and it continues to grow more complex,” Amir Hossein Khaleghi, an economist in Isfahan, told the New York Times. Before the war, Iran was “already in a very poor economic situation, facing a set of mega-crises,” he added.
The layoffs have affected sectors including manufacturing, steel production, petrochemicals, transportation, retail, and Iran’s technology sector, where companies dependent on internet access have struggled to continue operating during the blackout, according to the New York Times.
Iran’s internet restrictions entered their fourth month, causing severe disruptions to businesses and online services across the country. Analysts cited by Reuters estimated the blackout was costing the Iranian economy as much as $80 million per day.
Kamva, an Iranian e-commerce company, announced it would be ceasing its operations entirely last month in the wake of the war with the US and Israel.
“After two wars and months of internet shutdown, we could no longer bypass the crisis,” the founder, Hadi Farnoud, said in a post on X. “This time, it was impossible to continue.”
Iranian business leaders warned that as many as 3.5 million industrial jobs could eventually be at risk if the economic situation continues to worsen.
Some factories have either reduced production or halted operations entirely
Reporting by the New York Times in Iran suggested that some factories have either reduced production or halted operations entirely due to shortages of raw materials, electricity disruptions, and transportation problems linked to the conflict.
“In practice, some of these units do not have real production,” Bahram Zonoubi Tabar, a labor council official in Iran’s Fars province, was quoted as saying in an interview with the Iranian Labor News Agency
Reuters has separately reported growing concern among Iranian business owners over the impact of internet restrictions, with many small businesses, online retailers, and technology firms reporting major financial losses since the blackout began.
Jason Tuvey, deputy chief emerging markets economist at Capital Economics, told Radio Free Europe/Radio Liberty that “the [Iranian] economy will have to remain extremely depressed” even after the immediate conflict ends.
Iran’s government has not released comprehensive national unemployment figures since the latest escalation in fighting began.