The Puzzle of Income and Expenses in Iran; $136 Wages Against $500 Costs

The lives of a significant portion of Iran's population have turned into a puzzle as the Iranian economy is currently most affected by the dollar, leading to a dollar-based lifestyle where the minimum cost of living at a dollar rate of 61,000 tomans is $500, while workers' wages are $136. The website 'Tejarat News' reported that the minimum wage for an Iranian worker is equivalent to $136, noting that since 2017, the minimum wage has experienced an unprecedented decline against the dollar. According to this report, if the dollar price remains around 61,000 tomans in 2024, wages have only increased by $6 compared to the previous year. Experts believe that if the current economic conditions in Iran persist without political and economic shocks, the average dollar price this year will be 70,000 tomans. A review of wages in the region shows that Iran, with a minimum wage of $136, has the lowest payment among 10 other countries in the region. Reports indicate that Iran lags behind Azerbaijan with a minimum wage of $200 and Armenia with $210. Among regional countries, the minimum wage in Oman is $839, Saudi Arabia $800, and Bahrain $790. Conversely, Turkey has set its minimum wage at $600, Qatar $493, the UAE $408, Kuwait $327, and Iraq $260. A notable point among these countries is the stability of inflation and the full coverage of the costs of a standard living with minimum wage payments. In Turkey, which is also grappling with unprecedented inflation, the minimum wage doubled at the beginning of the new calendar year compared to the first month of 2023 to maintain workers' purchasing power. This action by the Turkish government contrasts with Iran, where the government refrains from reasonable increases in wages, citing inflationary concerns. In this regard, the Secretary-General of the 'House of Workers,' a government-affiliated body, believes that this behavior of the government will ultimately harm workers' livelihoods and economic growth. Alireza Mohajoub stated in an interview with ILNA on April 5 that government economic officials should understand that increasing workers' wages in the long term has an anti-inflationary effect and prevents recession. According to Mohajoub, the current wages do not meet the demands of the working community. This labor activist emphasized that the government is on an inappropriate path, which may deepen the economic recession in production and services and worsen the livelihood conditions of the working community. In response to the government's behavior, labor activist Rasoul Gorgij stated that this wage, with inflation exceeding 40%, only covers less than 10 days of living. On April 5, this labor activist told ILNA that under current conditions, if the government wants to slightly improve workers' economic conditions, a 50% increase would certainly not be sufficient. This situation comes as on April 3, a member of the Supreme Labor Council announced that the government would impose a 10% tax on wages over 10 million tomans, and accordingly, the wage increase for workers would be less than 30%. Ayat Asadi stated that the issue of calculating wages over 10 million tomans among those paying the 10% tax was supposed to be reconsidered in a bill sent by the Minister of Labor, but no news has yet emerged regarding this bill. According to the wage resolution of the Supreme Labor Council, which was approved only with the signatures of government and employer representatives, the minimum wage for workers subject to labor law increased by 35.3% compared to the previous year. The increase in wages for other levels was also set at 22% plus a fixed monthly amount of 6 million and 900 thousand and 780 rials. Considering other wage items, the minimum income for workers subject to labor law, married with two children, will be 11 million and 107 thousand tomans next year. Additionally, the minimum wage for workers subject to labor law, married with one child, has been set at 10 million and 892 thousand tomans. The determination of this wage by government and employer representatives has faced widespread protests from labor organizations. The latest 'official calculations' indicate that the cost of living this year exceeds 22 million tomans. Nevertheless, other figures such as 25 million have also been reported. In this regard, the Tasnim news agency reported on March 23 that 'according to announced statistics, the poverty line for a four-person household is about 25 million tomans.' Meanwhile, figures have also been reported, such as 30 million and more, which independent labor activists and organizations have emphasized. Despite all these discussions raised in the final months of the year, the government and employers reached a decision in the Supreme Labor Council meetings that the representatives of workers in the minimum wage determination committee refused to sign. Although this refusal, due to the composition that labor law has designated for the Supreme Labor Council, did not affect the final decision-making, the government issued the committee's resolution for implementation. Protests from labor activists and organizations regarding wages below the poverty line continue. A member of the Supreme Labor Council: The government takes 10% tax from workers' wages. The sugarcane workers' union of Haft Tappeh: The humiliating wage of 2024 is a blatant attack on the lives of workers and wage earners. Workers' disappointment continues; the determined wage only covers 40% of living expenses. An economist's reaction to the determination of 'minimum wage': The government should raise workers' wages 'like a human.' The government's opposition to the legal demands of labor representatives; wage increases are only 35%. The depth of the livelihood crisis during Ramadan; daily wages of 250 thousand tomans, iftar and suhoor costs 650 thousand tomans. The government's hand in determining the minimum wage has been revealed: a 20% proposal and widespread protests.