The coronavirus has hit hard at an estimated 2.8 million businesses and six million jobs in Iran, according to the director general of Policymaking and Job Department of the Ministry of Cooperatives, Labor and Social Welfare.
“By being hit hard, I mean, these businesses were either forced to close down, or reduce their capacity substantially,” Alaeddin Azvaji added.
Early projections by the ministry put the number of jobs at stake at approximately one million, which were mostly in businesses whose main activities revolved around Iranian New Year holidays and purchases of spring merchandise. But later in May, the impact of the disease on businesses went deeper and wider.
“At first, getting past the coronavirus crash seemed like a V-shaped recovery but then it transformed into a W-shaped recovery, following the second wave of coronavirus in late June. Of course, the second wave was not as severe as the first in March and April,” Azvaji told the Persian-language daily Shargh.
“The ministry had devised a few scenarios to manage the potential levels of the pandemic’s impact on jobs and businesses. Between 50,000-80,000 billion rials [$213-341 million] were needed to carry out these plans. Paying a fraction of small enterprises’ remunerations in the form of ‘income subsidy’ or insurance incentives for the workers of large companies were among our plans to prevent job losses and even help create more employment opportunities.”
Noting that a total of 850,000 insured workers have applied for three-month coronavirus unemployment benefits, the official said, “Estimates show that the outbreak of coronavirus has hit more than 1.2-1.3 million economic enterprises with more than 2.6 million uninsured workers. These figures might have changed over the past six months; some of this unemployed people might have been reemployed.”
In April, the government announced it would allocate 50,000 billion rials ($213 million) to Unemployment Insurance Fund to support those who have lost their jobs amid the viral outbreak. Applicants were asked to fill out online forms for unemployment benefits at the newly-designed website Bimebikari.mcls.gov.ir within 30 days, instead of going personally to the ministry’s bureaus.
“The government tried to stimulate minimum demand by handing out loans worth 10 million rials [$42] to households. The second measure was to grant loans to private sector employers, the self-employed and the uninsured. The program included 14 groups, including 880 businesses. This was the first time a mechanism was provided to identify uninsured workers through executive organizations,” Azvaji said.
Studies show unofficial workers and those without health and retirement benefits, are more vulnerable to the crisis. Under the program, the individuals who were working at sport clubs and educational and service centers received the government’s coronavirus loans.
“The Economic Taskforce of the National Headquarters to Fight Coronavirus provided a total of 200 trillion rials [$852 million] as loans with a lending rate of 12% and the repayment period of two years through banks,” he said.
Estimates show economic enterprises applied for nearly 120 trillion rials [$511 million] in loans and close to 30 trillion rials [$128 million] have been paid till now.
Azvaji added, “We tried to make the registration process for taking out loans quick and easy. As we speak, banks are in different stages of approving the applications, signing contracts or paying the loans. Some eligible businesses are yet to register for loans.”