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Youth Employment and the Crisis Ahead

Nameye Otaqe Bazargani [Newsletter of Chamber of Commerce]; Industries & Mines
Mar. 2000, No. 1
By: Jila Alizadeh

Summary: Official education which is the biggest consumer of public revenues, is producing very little employment due to lack of conformity with the community's needs and job market and lower productivity. On the other hand, love of comfort and indolence has become a cultural assumption in the present Iranian community and this has given birth to false occupations such as brokerage. We are witnessing an increase of 5.8 units to the percentage of the female university graduates and 4.6 units to the percentage of male university graduates and entry of 760,000 new forces into the job market. Under such circumstances the Iranian government is failing to discharge its least duty for employment of these youth by attracting domestic and foreign capital, adapting official education with the market needs and preventing aliens from working in the country.

Text: Studies have revealed that a youthful population, growth of technology and changes in the structures, has given boost to unemployment specially among the youth and educated class of the community and in case this matter is not addressed in a proper manner it may develop into a crisis in the future and threaten the community's health and security.

Those factors that influence the number of job applicants actually depend upon the population growth, age and gender and amount of participation of each category of population. The higher the proportion of population of 10 years old and above versus total population the more the supply of manpower will be. The supply of manpower also depends on the immigration of foreign nationals into the country because this will add to the number of workforce in the country and influence the job market.

Studies conducted in the job market has shown that population growth in the past years has increased the number of job applicants in the community. The 15 year old and above population in the country was 36.6 million in 1996 which is expected to reach 50.6 million in 2006. The number of 15 year and 29 year old active and non-active population in the 1996 census was 6 million and 10 million persons respectively. The young unemployed population from 15 to 29 years age in 1996 was 926,882 persons of whom 78% were males and the rest were females.

A study of available manpower in the country shows that during the Third Five Year Development Plan (2000-2005), each year an average of about 760,000 persons will enter the job market. Also 2.2 units will be added to the percentage of males with university education, 4.6 units will be added to the percentage of females with diploma education and 5.8 units to the percentage of females with university education. Moreover the secondary school and university education branches are such that their graduates are unable to benefit from their education at their working place.

During the recent years official education was the biggest consumer of the public revenues whilst with such giant educational costs, their yield has been very marginal. Due to weakness of the university and superficial approach to science and knowledge as well as lower scientific efficiency and engagement in profitable and non-productive jobs in the country, we are witnessing a low quality and non-creative youth engagement in the community. Lack of harmony between the people's expertise and their jobs, lack of harmony between the educational branch and the job market, and low manpower productivity in government departments, are other factors that have rendered employment inferior and non-creativity in the community.

Regretfully the injection of huge petrodollars into the economy specially during the pre-revolution years has caused the agricultural branch to remain inactive and cease to grow. Right now the agricultural sector does not enjoy the required dynamism and flexibility to attract workers and the service sector is growing in an incongruous manner. Meanwhile the other economic sectors have no logical link with each other.

Regretfully in recent years poor performance with higher income has become a conventional practice so that low productivity, quest for comfort and luxury has become a cultural assumption in the community. This has given gigantic boost to non-productive and non-dynamic branches including dealer and brokerage jobs. It has also lowered the value of labor in the community. Such poor productivity has emerged as one of the biggest obstacles in the way of growth of the economy. Other factors such as lack of security and confidence for investment (both domestic and foreign investment) and weak educational system in training creative manpower has affected the demand for job markets. Lack of attention to create jobs and protect jobs can lead to pessimism and frustration among the people and specially among the youth.

In the formulation of development plans specially during the Third Plan it is necessary to pay serious attention to employment and not to look at it as a superficial matter or predict employment by guesswork. The government and its affiliated departments and organizations and productive and service branches must be held responsible against failure to create employment and the number of job opportunities during the Third Plan must be specified. Creating supportive regulations and atmosphere for employers and investment to create productive jobs specially in deprived regions in the country and taking proper steps to export a percentage of the skilled manpower abroad, is one of the solutions to the problem of youth unemployment.

Also in order to make optimum use of the existing facilities and capacities and protect the existing jobs in workshops and small factories which can add to the value added by employing new staff, the government must pay the necessary subsidies and extend other financial support to such workshops and factories. Also arrangement must be made for dissemination of information about job markets, technical and vocational training centers, methods of investment and acquisition of necessary permits to start economic activities and bank credits which is now being disseminated by various organizations in a scattered manner, so that this will be done solely by employment branches throughout the country. Employers must also be bound to announce job opportunities and to attract their needed manpower through employment offices.

In order to solve the problem of youth unemployment, it is necessary to set up information dissemination branches in schools with the assistance of the Ministry of Labor and Social Affairs by offering jobs and job skill consultative services and teaching method of investment and acquisition of necessary permits to start new jobs in the productive branches. On the other hand, the Ministries of Culture, Higher Education, Labor and Social Affairs and State Technical and Vocational Training Organization must coordinate their policies to conform the educational branches with the job markets specially with regard to human and basic sciences.

Preventing unauthorized employment of alien workers, reducing government supervision and eliminating bureaucracy and creating economic security and stability to attract domestic and foreign capital, are other solutions to the problem of youth unemployment in the country.

Expanding and equipping the technical and vocational training centers throughout the country, creating diversity in educational branches with an eye to the job market demands, attracting petty and wandering deposits and creating necessary grounds for public participation by establishing `labor banks', are among other solutions to solve the crisis of youth unemployment.