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Mehdi Dehghan

Nowadays, Iran has become one of the largest producers of graduates in the Middle East and the world, and “from subsidy to employment” or in other words, the internship program, is a plan that is supposed to help unemployed graduates. According to Mohammad Farhadi, the Minister of Science, Research and Technology, between 800,000 to one million people graduate from universities in the country annually, while nearly 75% of job seekers in the country have a university degree. This is while in 2016, there were approximately 1.2 million empty seats in universities across the country.

According to the published report of the Statistical Center, the unemployment rate in Iran is 12.4% and the number of unemployed people is more than 2.2 million. On the other hand, there are more than 5 million university graduates in the country and the government intends to solve this problem with the internship program. This program has been implemented slowly for years, but until the presidential election and Ghalibaf’s promise to register unemployed people and pay a 250,000-toman subsidy, no one knew about the existence of this program.

Rouhani’s internship program before the elections to counter Qalibaf’s populist plan received more attention than in the past and was referred to as “from subsidies to employment”. According to Rabiei, the Minister of Cooperatives, Labor, and Social Welfare, it is predicted that between 125,000 to 200,000 people will be employed through job placement and registration in the system. However, by comparing the goals of this plan with the number of unemployed graduates, it can be seen that the internship program is much smaller than what is needed to tackle the major issue of unemployment.

Rouhani also mentioned in a news program on the 21st of Ordibehesht of this year, explaining the plans for the internship program: “In this program, young graduates who lack sufficient skills will receive 4 months of training and one third of their salary will be given to them until they are employed in a workshop of their choice, as part of the government’s 100-day plan.”

What is an internship program?

Annual employment of 150,000 unemployed graduates through the internship program with a 2-year exemption from employers’ insurance payments is one of the objectives of this program. The target community of the internship program includes university graduates aged 23 to 32, taking into account 2 years of military service, in all fields of study according to the needs of private and cooperative economic enterprises.

The internship program under the Kaj plan, or the entrepreneurship and employment plan for youth, has been put on the government’s agenda. This plan has been implemented experimentally in 8 provinces so far and is planned to be implemented in all provinces of the country this year. Currently, interns must register in authorized job placement programs in addition to registering in the registration system at karvarzi.mcls.gov.ir to take advantage of the benefits of this plan. The internship period is between 4 to 6 months and the interns will receive one-third of the minimum wage approved in 2017 by the government, which is approximately 310,000 tomans per person.

Employers, or the accepting units of interns, have no obligation to guarantee the recruitment of interns in their respective units. However, according to Aladdin Azouji, the advisor to the Minister of Labor, in experimental projects, about 70% of interns have been recruited in the relevant unit.

With the serious implementation of this plan, Mohammad Akbarinia, the general manager of the Office of Labor and Employment Guidance and Placement of the Ministry of Labor, also announced a 20% increase in the number of unemployed graduates referring to employment offices and said, “The current share of employment offices from the job market is 25%.”

Details of the seven-day registration for the internship program.

If this plan is timely funded and pursued seriously by the government, unemployed graduates should successfully complete the seven-month internship program. According to experts, this program is like a gamble with no definite end, as the employer has full discretion and there is a high possibility of exploitation of interns.

The maximum age for unemployed graduates is 23 for associate degree, 25 for bachelor’s degree, 28 for master’s degree, and 32 for doctoral degree, with an additional 2 years for military service. If the applicant has more than 3 months of social security or public service experience, they are not eligible for this program.

Furthermore, if 3 years have passed since the applicant’s graduation, they are not eligible to register for the program, while also being unemployed and having a service completion card or exemption. Another interesting condition of the internship program is that re-registration is not possible for interns and the applicant must have no previous participation in an internship program listed on their resume.

It is mandatory to spend at least three months after registering at the Employment and Career Counseling Center, and the intern must also complete the “Job Readiness” training course during the internship period through the Technical and Vocational Training Organization and obtain the relevant certificate.

8 pilot provinces

According to the executive guidelines of the internship program for university graduates, approved by the High Council of Employment on 5 Bahman 1395, accepting units in major cities such as Tehran, Karaj, Tabriz, Mashhad, Isfahan, Shiraz, Ahvaz, and Qom are required to pay a contribution equivalent to the government’s share to the interns. Other units located in different parts of the country must pay at least one third of the government’s contribution to the interns.

Furthermore, if the receiving unit is closed for a minimum of one week and a maximum of 30 days, or if the intern is absent for more than 5 days, the internship period will generally be considered invalid.

Internship program or employment mirage

According to the predictions of the Parliamentary Research Center, the unemployment rate in Iran is expected to reach around 16% in the optimistic scenario and around 26% in the pessimistic scenario by the year 1400. According to the report of the Statistical Center, the inflation rate is 7.1%, which is a significant improvement compared to the 40% inflation rate during Ahmadinejad’s presidency. However, at what cost?

Tayeb Nia, the Minister of Economy, has successfully justified the economic weaknesses over the past four years by controlling inflation. He believes that the government has brought the economy from a 40 degree fever to below 10 degrees. However, it must be said that naturally, by putting a disease in the freezer, its fever decreases, but the disease itself is not cured. Inflation has reached below 10%, but the economy has become severely stagnant and depressed; by freezing the economy and creating an imbalance between supply and demand, the inflation rate naturally decreases. In simpler terms, the government has turned a blind eye to fix the economy’s reputation.

The closure of thousands of production units following the disastrous policies of the Ahmadinejad government has continued in the Rouhani government as well. Therefore, if the government is seeking the success of the internship plan, there must be employers to attract interns. Unfortunately, both interns and employers are currently unemployed or on the brink of unemployment. Therefore, the government must first have a plan for employment or the continuation of employers’ livelihoods.

A look at the turbulent employment situation in Iran.

According to the Sixth Development Plan, the government’s duty is to create 950,000 jobs annually and in the next 5 years, at least 4.75 million jobs must be created. This is while in the next 5 years, 5 million university graduates will be added to the job market. According to Jalali, the head of the Parliament’s Research Center, Iran will face around 5 million unemployed people by 2021. However, the Parliament’s Research Center recently deemed the reported 2-3 million unemployed population as unrealistic and announced the actual number to be 7 million people.

According to Hossein Raghefar, an economic expert, the unemployment rate of 12.4% indicates the absolute level of unemployment; meaning that individuals in this statistic are considered unemployed even if they do not engage in any economic activity for just one hour per week. For example, individuals who work 15 hours per week are considered to have partial employment. Now, if we add these individuals to the absolute unemployment rate, the actual unemployment rate increases to approximately 35 to 40 percent of the population.

Furthermore, according to the report of the Statistical Center of Iran, out of 11 million and 392,227 individuals who have obtained a university degree, 4 million and 544,775 are employed and 1 million and 34,129 are actively seeking employment. However, the most important and concerning fact is that 5 million and 813,322 individuals who have attended university and have a degree are inactive and have no involvement in the country’s business and economic activities.

Note:

This report has used statistics and information from the Statistical Center of Iran, the Ministry of Labor, the Ministry of Industry, and published interviews of officials in the news agencies of House of Nation, Mehr, and Tasnim.