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Iran’s high population growth rate in the 1986–1996 decade led to drastic changes in the population fabric which eventually resulted in an increase in the number of new workforce.

Population growth and its consequences are old problems that keep getting renewed to the developing world. A recent census by the State Management and Planning Organization reveals details of a baby boom and its likely consequences.

Population Increase: Iran’s population registered an annual 1.66% growth last year closing in on the 64 million level. The last Iranian year which ended on March 21, 2001, saw Iran accommodate 1.045 million more people. If that trend persists, Iran’s population will almost hit the 65 million and 66 million levels by March 2002 and March 2003 respectively.
The report by the Management and Planning Organization shows middle and average age indicators in Iran have taken an upward trend in the past few years. Two years ago these indices stood at 20.7 and 25.5 years respectively. Last year, they rose to 21.3 and 25.8 years. This year, these figures are expected to stand at 21.8 and 26.2 years. The growing trend carries on next year taking the figures to new highs – 22.3 and 26.5 years. Although this evolving trend indicates a drop in the population under active age, it registers a dramatic rise in the active age population. This has drawn much official attention in the past years. It will remain a top priority in the years to come because each passing year sees the influx of new workforce into job market.

Workforce: Iran’s potentially active population (15 – 64 age bracket) accounted for 60.39% of the total population two years ago. Last year, the figure stood at 61.74%. It is expected to rise to 63.04% this year and estimates put the figure at 64.03% for next year.
Studies conducted at the Macroeconomics Division of the Management and Planning Organization show emergence of new workforce in Iran has been and will remain “substantial” from 1997 to 2002. New workforce emergence from 1996 to 2000 was twice bigger than the 1966–1996 period. Iran’s active population that stood at 16.027 million in 1996 has registered a 3.7% annual growth ever since, reaching 18.559 million last year.

In 1999, when oil prices began to see the daylight, Iran’s investment and production growth rates shot up, so did the employment growth rate

During the same period (1996 – 2000) employment rate logged a 1.7% annual growth. That translates into rising unemployment and building pressure on the job market. Different factors among them changes in population fabric, an increase in the number of university graduates and changes in income pattern of low-income families account for the dramatic rise in the number of new workforce. Iran’s high population growth rate in the 1986–1996 decade led to drastic changes in the population fabric which eventually resulted in an increase in the number of new workforce.
The skyward trend will carry on in the coming years with the new workforce figures edging on 20 million next year. Workforce contribution that stood at 35.3% in 1996 is likely to reach 37.1% next year. From 1996 to 2000, each year some 633,000 new workforce joined in the search for employment. The trend is expected to persist in 2001 and 2002. Before 1996, no more than 258,000 new workforce would emerge annually.
Affected by a drop in oil prices in international markets and the mark they made on investment and production growth rates, the working population grew at a leisure increasing from 14.572 million in 1996 to 14.811 million in 1998. That means each year only about 120,000 job opportunities were created.
In 1999, when oil prices began to see the daylight, investment and production growth rates shot up, so did the employment growth rate. In 1999, some 366,000 job opportunities were created bringing the total number of working population to 15.177 million. With oil prices still on the rise in 2000, some 400,000 jobs were created helping the working population close in on 15.58 million.
A recent boom in new workforce pushed the number of the unemployed from 1.455 million in 1996 to 2.983 million in 2000. Even creation of one million jobs in the four-year period could not beat joblessness. Reports released by Iran Statistics Center show unemployment rate in Iran stood at 13.5% and 14.3% in 1999 and 2000 respectively. A census for the 30 days to May 21, 2001, indicated unemployment had shot up to 15.8%. A mushrooming new workforce in the current year will push joblessness further up (16.2%) by March 2002. Generalization along with contribution rate accounts for the difference in figures released by the Macroeconomics Division of the Management and Planning Organization and those of Iran Statistics Center.