March 31, 2008 / 11:43 AM / 10 years ago

Iran's unemployment falls to 10.3 pct -minister

TEHRAN, March 31 (Reuters) - Iran’s unemployment rate dropped to 10.3 percent in the 2007-2008 Iranian year from 11.3 percent the previous year, state radio quoted a senior government official as saying on Monday.

Minister of Labor and Social Affairs Mohammad Jahromi said improvements in the housing, industry and mining sectors helped cut the jobless rate in the world’s fourth-largest oil producer. The Iranian year ends on March 20.

Iran has reaped windfall gains in recent years from the high oil price on world markets and says its economy grows by about six percent annually, despite tightening international sanctions on Tehran over its disputed nuclear plans.

Analysts say the nuclear standoff is making foreign companies more wary of investing in the Islamic Republic.

“The unemployment rate in the country has dropped to around 10 percent ... despite the increase in the country’s active population,” Jahromi said.

He said it had been as high as 14-15 percent in previous years but did not specify when this was. Some economists have said the unemployment rate is higher than the official figure, estimating it at 25 percent in some parts of the country.

Jahromi said every percentage point drop in the jobless rate would imply the creation of around 245,000 new jobs in view of an active work force of 24.5 million people.

The conservative government of President Mahmoud Ahmadinejad came to power in 2005 pledging to share out Iran’s oil wealth more fairly. But critics say profligate spending has further fuelled inflation, running at about 19 percent year-on-year.

Conservatives retained their clear majority in the Iranian parliament in a March 14 election but analysts expect the assembly to become more vocal in its criticism of Ahmadinejad’s economic management ahead of next year’s presidential election.

Jahromi said the government aimed to cut the jobless rate further to around 8.4 percent by 2010, when the current five-year social and economic development plan ends. (Reporting by Hashem Kalantari; Editing by Fredrik Dahl and Gerrard Raven)

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