Iran Faces Unprecedented Job Losses Amid Ongoing Conflict

Tue Apr 21 2026 18:08:39 GMT+0000 (Coordinated Universal Time)

The Iranian economy struggles as millions face job losses due to the war with the US and Israel, highlighting the wide-ranging impacts on various sectors including manufacturing and technology.

The conflict with the US and Israel has resulted in approximately two million job losses in Iran, severely impacting the economy. Officials report widespread layoffs across sectors, with a 52-day internet blackout exacerbating the situation and further hindering the digital economy. As consumer spending dwindles and essential businesses struggle, the potential for long-term economic distress looms over the nation.

Iran has been hit by a massive wave of redundancies, both directly and indirectly as a result of the conflict with the US and Israel.

Its Deputy Work and Social Security Minister, Gholamhossein Mohammadi, said two days ago that two million people had lost their jobs because of the war.

The widespread lay-offs are a primary topic of discussion among Iranians on social media. Employers and government officials refer to it as 'balancing the workforce'.

The impact extends beyond factories damaged by air strikes, affecting retailers, manufacturers, and the digital sector.

Comments on social media reflect the situation: You can see it from the emptiness of the metro... My one-and-a-half hour journey took only half an hour, stated one user.

The war has also negatively impacted consumer spending, with many cutting back to essentials. This has reduced demand in tourism and retail sectors outside of grocery sales.

The Iranian authorities' decision for an internet blackout since the war escalated has further harmed its tech and digital industries. Officials say this step is for security, aiming to prevent surveillance and cyber-attacks. Back in January, the Information and Communication Technology Minister noted that the internet blackout costs the economy at least 50 trillion rials ($35 million) daily.

For 52 days of internet shutdown, the loss is estimated at over $1.8 billion.

The blackout has adversely affected women, particularly those who relied on social media to connect with customers. Before the war, only one in nine working-age women in Iran were employed, with many using platforms like Instagram for sales.

While demand for news has surged due to the conflict, media outlets have also laid off staff, including the Iran Labour News Agency, which made all its journalists redundant last week.

Air strikes have targeted significant petrochemical plants and steel manufacturers, leading to direct job losses among thousands and indirectly affecting hundreds of thousands more in related sectors.

The disruptions have also extended to Iran's car manufacturing industry, which employs about one million people either directly or indirectly, with reports of widespread layoffs.

Some companies promise rehiring post-war, while others enforce unpaid leave on employees. The government's proposed loan scheme for small businesses offers minimal help.

The situation worsens as the official inflation rate surpassed 50% in March 2026, with expectations for further increases. If the war continues or international sanctions remain, life for millions could deteriorate even more severely due to rising unemployment and inflation.