Iran's Labor Market in the 'Monopoly' of Men

The Open Data Iran database is an innovation project aimed at collecting data related to Iran in one place and presenting it in easily accessible formats. Radio Farda, in collaboration with this institution, publishes a collection of articles. Official statistics released by the Statistical Center regarding Iran's labor market show that over the past decade, the economic participation rate of women has decreased while the unemployment rate for women has increased. This has occurred despite a significant increase in the number of female students and female university graduates; however, contrary to expectations, the increase in the number of women with higher education has not led to an increase in the economic participation rate of women. Overall, women's share in the labor market has decreased, and the gender gap in this market has widened. The upcoming study examines trends and statistical indicators to investigate the presence of women in Iran's labor market and compares the changing trends of women's participation in this market with the changing population of women with university education. The overall state of the labor market shows that since the mid-2000s, the labor market in Iran has taken a different trend. With the increase in the total population of the country and also the 'working-age population' during this period, it was expected that the number of new job opportunities would increase in line with population growth. However, not only has this not happened, but the number of employed individuals has remained almost constant. If we compare three demographic indicators provided by the Statistical Center of Iran, namely the total population, the working-age population, and the employed population, a clearer picture of the trends in Iran's labor market emerges. While detailed figures for all years are not available, if we consider the years 1986, 1996, and 2006, when the Statistical Center conducted a nationwide census, and compare the average of the three mentioned indicators, the trend of their changes over the decades becomes apparent. Additionally, since the population and housing census in 2016 has not yet been conducted, we can use the latest report from this center on the workforce in 2014 and extract the figures for the three mentioned demographic indicators from this survey and then compare the average of the last period with the averages of the previous periods. As seen in Chart 1, from 1986 to 1996, an average of 1,061,000 people was added to the country's population annually, from 1996 to 2006, 1,044,000 people, and from 2006 to 2014, 765,000 people were added. The average annual increase in the working-age population during these three periods was, respectively, 1,252,000 people, 1,412,000 people, and 561,000 people. The average number of people added to the employed population annually during these three periods was 357,000 people, 590,000 people, and 103,000 people, respectively. An important point is the change in the definition of unemployment during this period. A change that occurred in the mid-2000s caused some individuals who were previously considered unemployed to be regarded as employed. For example, individuals who worked only one hour during the survey period are considered employed under the new definition. According to this data, the growth rate of the population and the working-age population was higher in the first two periods than in the last period. The number of jobs created has also significantly decreased in the last period. In other words, the job opportunities created in the total years of the third period are less than the jobs that were created on average in two years of the second period. Therefore, it can be concluded that since the mid-2000s, the labor market in Iran has followed a trend that has significantly increased the number of unemployed individuals. This has occurred during a period when the young job-seeking population and the number of university graduates have also increased significantly. Additionally, during this period, global oil prices reached their highest historical levels, providing abundant financial resources for Iran's economy for job creation; however, as the statistics show, despite this rare financial opportunity, job opportunities have not increased as expected. To gain a clearer understanding of the labor market conditions in Iran in general, and to be aware of the conditions of women in this market specifically, this study examines the period from 2005 to 2014, during which the trends of labor market indicators changed significantly. The unemployment rate for women is more than double that of men. One of the most important indicators in studying the labor market is the unemployment rate, which is specified and announced in Iran based on calculations from the Statistical Center in the labor force survey. In Chart 2, the overall unemployment rate, the unemployment rate for men, and the unemployment rate for women during the period from 2005 to 2014 are separately visible. Comparing these three rates in the mentioned decade shows that the unemployment rate for women has always been higher than both the unemployment rate for men and the general unemployment rate, while the unemployment rate for men has always been lower than the other two rates. An important point is the change in the definition of unemployment during these periods. A change that occurred in the mid-2000s caused some individuals who were previously considered unemployed to be regarded as employed. For example, individuals who worked only one hour during the survey period are considered employed under the new definition. Another noteworthy point is the contradictory trend of the unemployment rates for men and women during this period. Considering the unemployment rate for men at the beginning and end of this period, it can be observed that the unemployment rate for men has followed a positive trend, decreasing from 10 percent in 2005 to 8.8 percent in 2014. However, this trend has been reversed for women, as the unemployment rate for women increased from 17 percent at the beginning of this period to nearly 20 percent at the end of the period. The overall unemployment rate also decreased from 11.5 percent to 10.6 percent during this period. In other words, both the overall unemployment rate and the unemployment rate for men improved after a fluctuation shown in the chart, but the unemployment rate for women increased. Based on this information, the overall unemployment rate increased in 2009 but began to decline again from 2011. However, this improvement has not been reflected equally in the unemployment rates for women and men, with the unemployment rate for men decreasing more significantly since 2011. In simple terms, the relative improvement in the unemployment rate has primarily benefited men. Statistical ambiguity regarding the unemployment rate During the mentioned period, a significant number of people have been added to the working-age population in Iran, but less than one million job opportunities have been created. However, this large discrepancy has not only not been reflected in the unemployment rate statistics but has also shown an improvement in the official unemployment rate, as the unemployment rate at the end of this period is lower than at the beginning. This puzzling occurrence has been the subject of various studies and research. One of these studies was conducted at the Higher Institute of Education and Research Management and Planning, which operates directly under the President. This research, titled 'Examining the Status of the Labor Market in Iran in 2013 and 2014,' explains this statistical ambiguity by stating: 'The lack of reflection of this significant gap in the unemployment rate is due to two factors: the significant increase in the number of students on one hand, which means a delay and sudden entry of the educated population into the labor market, and the discouragement of another segment of the population and their failure to enter the job-seeking population.' The conclusion of this research is particularly valid for the conditions of women in the labor market, as both the inclination of women towards higher education has increased more than before, and the unfavorable labor market conditions have discouraged a significant number of women from finding work. Therefore, a large number of women in the working-age population have not been job seekers and have, in statistical terms, been excluded from the active population. For a clearer understanding of this statistical issue, it is necessary to consider the concept of active and inactive populations. The decreasing trend of active women in the labor market Economically, the population is divided into two sections: active and inactive. The inactive population, although of working age, is either unable to work or unwilling to have a job. In contrast, the active population of society has both the ability and willingness to work, so they are either employed or seeking work. Therefore, only those individuals of working age who have both the ability to work and the desire to have a job but are unemployed are considered unemployed. Data released by the Statistical Center shows that during the examined period, the active population of women not only did not correspond with the increase in the working-age female population but, in a puzzling event, the number of active women has decreased. Chart 3, which shows the active population during the study period, reveals the stark difference in the active female population in comparison to the active male population in the country. Another noteworthy point regarding the active population is the contradictory trend of this indicator for men and women. As shown in Chart 3, the active female population at the end of the examined period was about one million less than at the beginning of the period. In contrast, the active male population at the end of the same period increased by more than 1.5 million compared to the beginning year. In other words, despite the increase in the working-age female population, the number of job-seeking women has decreased. Decrease in women's economic participation rate The economic participation rate is obtained by dividing the active population by the working-age population. This rate is one of the important indicators in studying the labor market. Comparing the economic participation rates of men and women in Iran shows that the economic participation rate of women is lower than the overall participation rate and significantly lower than the participation rate of men. Moreover, the participation rate of women has shown a declining trend during the examined period. Chart 4 clearly illustrates the economic participation rates for the total population, men, and women during the examined period. This chart clearly shows that in all years of this period, the economic participation rate of men has been approximately 25 percentage points higher than the overall participation rate, while the economic participation rate of women has been lower than the overall participation rate by a similar margin. As previously mentioned, the reason for this occurrence is that despite the increase in the working-age population, the number of active individuals in the country has decreased, with the majority of this decrease occurring in the active female population. Chart 4 clearly shows how the participation rates of men and women have decreased. The participation rate of men during this period has always been above 60 percent, decreasing slightly from 64 percent in 2005 to 62 percent in 2014. However, the participation rate of women, which was 17 percent in 2005, decreased to 12 percent in 2014. In simple terms, only 12 percent of women of working age wish to participate in the labor market in Iran, while 62 percent of men of working age wish to be present in the labor market. The economic participation rates of women and men reveal the deepening gender gap in Iran. Increased presence of women in universities The participation rate of women has decreased during the years from 2005 to 2014, while the number of female students and consequently female university graduates has seen an unprecedented increase. This increase has been such that in some years of the examined period, the number of female students has surpassed that of male students. Chart 5 shows the number of students from the beginning of the 2000s, separated by gender. The number of female students in 2005 was over 1,231,000, and this number exceeded 2,253,000 in 2014. The significant presence of women in universities and the increase in their academic and professional skills have not only failed to improve the status of women in the labor market but have also led to a decrease in the number of employed women with university degrees compared to the total employed female population during the examined period. Chart 6 shows the employment ratio of university graduates, separated by gender, during the examined period. As seen in the chart, the employment ratio of graduates has shown a decreasing trend for both men and women, but the rate of decrease for women has been significantly steeper than for men. Among men, the employment ratio of graduates has decreased by more than 11 percentage points during the examined period. This downward trend has also been present for women, but the rate of decrease has been sharper, with the employment ratio for women graduates dropping from 53 percent in 2005 to 33 percent in 2014, a decrease of 20 percentage points. Summary The gender gap in the labor market has visibly increased, and officials confirm this in their official statements. For example, Shahindokht Molaverdi, the Vice President for Women and Family Affairs, stated in the first 'Brainstorming on the Unknown Cultural and Social Capacities of Working Women' that: 'According to the 2011 census, the economic activity rate of women with higher education was about 31 percent, while the economic activity rate of men with higher education was 600 percent.' The participation rate of women has decreased during the years from 2005 to 2014, while the number of female students and consequently female university graduates has seen an unprecedented increase. A noteworthy point regarding the labor market for women in Iran is that in all the examined indicators, namely the unemployment rate, active population, economic participation rate, and employment ratio of female graduates, two negative occurrences have taken place. Firstly, the gender gap has widened to the detriment of women, as the unemployment rate for women, the active female population, and the economic participation rate have all decreased significantly.