According to U.S. Treasury Secretary Scott Bessent, the economy of Iran will contract by 25% within the next six months. And a high Iranian official says that another 1.4 million people will be unemployed by the end of this October. More on the Iranian economy can be found here: “Iran economy faces 25% deeper contraction amid soaring inflation, major employment crisis,” by Danielle Greyman-Kennard, Jerusalem Post, October 28, 2026:
Iran’s struggling economy could see as many as 1.4 million people leave the labor market by the end of the Iranian calendar year if the pattern of economic contraction continues, according to Seyed Malek Hosseini, deputy for entrepreneurship and employment in Iran’s Cooperatives, Labor and Social Welfare Ministry.
According to official figures Hosseini cited in an interview with the Iranian Labor News Agency earlier this week, about 700,000 jobs were lost during the war, though he acknowledged unofficial reports suggest the actual figure could be closer to two million.
The Iranian regime had cut off all Internet access last January, during the nationwide protests, in order to prevent protesters from communicating with each other and organizing protests online. But in doing so, Iran’s rulers also prevented businesses and customers from accessing one another online, leading to a contraction in the economy.
The economy and employment sector was hit by an Internet blackout lasting nearly three months, starting during the January protests earlier this year, which left many people unable to access the online platforms and services needed to run their businesses and carry out their work.
Even if all 700,000 people whose job losses the government acknowledged applied for monthly unemployment benefits, the 16 million to 17 million tomans they would receive would be insufficient to cover basic living costs amid soaring inflation, Hosseini said.
Year-on-year inflation reached 89.8% in September 2026, while the national consumer price index rose 4.2% from August to 729.8, the Statistical Center of Iran reported last month.
An inflation rate of almost 90%? How can businesses plan, or banks lend money, with such a rate? And as the cost of living soars, how can those on fixed incomes, such as retirees, survive? The regime has made no move to increase those payments. Nor has it done anything to drive down the costs of medication.
The soaring cost of living has reportedly had fatal consequences. Two retired Iran Air employees had died after they could no longer afford treatment and medication, Iran Air Retirees Association chairman Jalal Hashemi told ILNA.
Despite the regime’s failure to increase retirement and welfare benefits, and amid weekly protests, Lebanon-based Hezbollah has reportedly received tens of millions of dollars from Iran to build up its military capabilities ahead of future wars with Israel, according to unnamed sources who spoke with Reuters earlier this week. This is in addition to $200 million reportedly provided last month to compensate the displaced.
Hosseini said 54% of Iran’s labor market was in the informal sector, a share that had grown further following the war. Many workers in this sector lack employment protections and insurance coverage, while others are unable to secure enough working hours or income to meet their basic needs, he said….
More than half of those Iranians who are employed are irregular, or gig, workers. They have no benefits, no insurance, and no employment protections — they can be sacked at a moment’s notice. And they often work fewer hours, and receive less pay, than they need just to survive.
“Official reports show that economic growth in the spring, compared with the same period in the previous year, was negative 10% excluding oil and negative 4.6% including oil,” he said. “Given the increased sanctions and the serious economic blockade, we expect the summer to follow the same trajectory….
The American blockade of Iranian ports has meant that Iran cannot export any of its oil, which has always been its main source of income.
The Iranian economy is in a death spiral. Less personal income, because of both widespread unemployment and the lower salaries for those who are employed, means a decline in buying power; that in turn leads to lower revenues for Iranian businesses, which means that businesses have to cut costs by firing employees and lowering salaries of those who remain employed.. And the cycle continues, as the economy contracts, which means less buying by Iranians, and more businesses shrink their workforce.
According to the Financial Times, Iran’s first vice-president Mohammad Reza Aref earlier this week began urging citizens to limit their use of subsidized gas to prepare for greater domestic demand in the winter. Iranian Parliament Speaker Mohammad Bagher Ghalibaf has also previously called for citizens to cut the country’s natural gas consumption by 10%.
And what are Iranians supposed to do? Stop cooking with gas? Stop heating their homes with gas? Mohammad Reza Aref doesn’t say.
With Iran’s energy infrastructure significantly damaged by the war, caretaker Oil Minister Hamid Bovard discussed joint oil and gas projects with Russian President Vladimir Putin in Moscow on Monday, with Tasnim reporting that a gas trade deal was “almost finalized” and that Russia was developing four major Iranian oil fields under contracts agreed by both sides….
It will be several years before these new Iranian oil and natural gas fields can actually produce oil and natural gas. And who knows what could happen if the regime remains in power till then, which may mean a continuation of the American blockade of Iranian ports. How will that oil and natural gas be exported?
Bessent added that unsanctioned Iranians could provide information to the US Treasury under its whistleblower program and be rewarded with up to 30% of recovered funds.
Bessent is right. The regime is going bankrupt as it remains unable to sell any of its oil or gas. And the people of Iran are sinking into mass poverty. The American administration need merely wait and watch as the slow-motion economic collapse leads to political turmoil, with Basiji whose relatives are suffering financially, and may themselves be underpaid, refusing to fire on the protesters. In 1978, it was when the Iranian soldiers refused to fire on protesters that the shah’s regime came tumbling down. That same scenario could happen again with the Islamic Republic.
Raja says
“War” is never fun and we are witnessing that with Iran. Iran might be dying a slow death because of blockade but the world needs to cautious for the coming apocalypse – for Iran where the mullahs won’t mind taking the common man on the streets with him-to hell. That is plausible as the mullahs won’t have to face the wrath of the public (as they perish together)
Taffy says
I’d say that the U.S. naval blockade is very effective. Letting them stew until their gas reserves are depleted and they have no money to take care of their own military and population (but plenty for Hizb’allah) is good planning. Once a major aerial assault by the US and Israel takes place, Iran will probably be ripe for a successful internal revolution. The U.S. needs to then occupy Iran as it did with Japan in WWII, until a replacement government (whether the Shah or otherwise) is instilled. So far the Uas has lost about 10 troops due to enemy action (but a lot more due to stupidity and accidents). At this rate, this will be the cleanest war that we’ve ever fought. The Iranian people will soon be liberated, and Iran will again be friendly to the US and Israel. The evil ayatollahs’ world empire will finally dissolve, and terrorism from Iran will be no more.
The liberals in the US have no idea of the necessity of getting rid of the Islamic regime in Iran. They all falsely believe that what’s over there will not affect us, and that Trump is evil for meddling in those pious Muslim’s affairs.
The two threats says
Any non-Muslim forces introduced into Iran, whether to invade and defeat the Islamic regime, or to occupy Iran after the Islamic regime has been ousted, would be targeted by pro-Islam forces.
The mere presence of non-Muslim forces would be exploited by Islamic forces propaganda.
The Islamic forces would call the non-Muslims “infidels” and call for Jihad against the “infidels”. Any non-Muslim forces would be targeted in a nation-wide insurgency, similar to the Iraq War after 2003.
The US should not put any troops on the ground in Iran, but provide anti-regime Iranians the means to overthrow their oppressors and seize power.