During the past week, and only 10 days before May 1 International Workers Day, labor news sources report the laying off of at least 2,500 industrial and leather workers in Ilam and Mashad.  Counting other laid-off workers in industrial and large cities such as Abadan, Ahwaz, Khorramshahr and Shiraz, during the last two weeks, more than 4,000 workers have lost their jobs just in the recent past.

In fact this unemployment trend has picked up unprecedented pace in the recent year.  The crisis in Iran’s industrial sector has reached such a level that, in an interview yesterday, the head of Iran’s House of Labor predicted the closure of hundreds of large and medium industrial firms per year and the subsequent laying off of 200,000 workers every year after that.

A labor activist in Ilam told Iran’s Labor News Agency yesterday that at least 1,000 industrial workers had been laid off in Ilam, adding, “Officials think that the situation in less developed areas is better because of lower costs. But this is not true.  An industrial crisis has spread throughout the province and during 2008 and 2009, 20 firms have shut down and more than 1,000 workers have been laid off.  All of this points to the absence of occupational security for workers.”  

The wave of closures and lay offs has reached industrial firms and workers in Mashad.  According to various reports, the closure of leather factories in Mashad is continuing, so far leading to the laying off of at least 1,500 workers.  

According to Safir website, one leather expert in Mashad said, “Fluctuations in the exchange rate, increasing smuggling of Chinese and Thai shoes at much lower prices has caused 45 major leather factories in Khorasan to shut down since 1382, laying off at least 1,500 workers in the sector.”  

The increasing frequency of firm closures and worker layoffs prompted House of Labor president Alireza Mahjoub to hold a press conference for the second time in as many weeks.  

The labor leader called the crisis in Iran “unprecedented” and predicted that the “critical situation would worsen as a result of the inflation shock from the subsidy reform plan.”  

Noting that even prior to the subsidy reform bill, the cost of production of domestic goods were higher than their market price, he said, “Because the subsidy reform plan will increase the price of water, electricity, gas and other basic goods, we will see an increase in the production costs of domestic firms.”  

At the end of the interview, Alireza Mahjoub announced plans to hold International Workers Day events, while last week the interior ministry and governor of Tehran refused the House of Labor’s request for permits to hold events on the International Workers Day.