In recent years, inflation has tightened its grip on the social welfare of Iranian households, severely compromising their purchasing power, especially among low-income groups. Over the past four years, the country’s inflation rate has surged past 40%, making even basic necessities like housing, cars, and groceries increasingly out of reach for many.
As of December 2023, the calculated rate for the Iranian workers’ livelihood basket stands at ‘23,500,000 tomans’, a figure expected to rise further based on January’s data. To adequately cover family expenses, workers’ incomes should ideally reach at least 20 million tomans.
According to Article 41 of Iran’s Labor Law, the Supreme Labor Council, overseen by the Ministry of Labor, determines the minimum wage for the upcoming years based on inflation rates and the household livelihood basket. However, recent reports indicate a concerning trend.
On December 26, ‘Ham Mihan’ newspaper revealed that this year’s real minimum wage for workers hit its lowest point in 28 years. Another report by ‘Donya-e Eghtesad’ on December 22 highlighted the impact of food price increases, attributing them to inflation. It stated that a worker supporting a family of four must allocate approximately 65% of their income to afford a basic food basket.
Further, ‘Etemad’ newspaper, on December 25, emphasized that despite the society grappling with at least a 50% inflation rate at the beginning of the year, the minimum wage only saw a 20% increase compared to the previous year. This disparity has effectively halved the real wages of workers since its inception. Under current conditions, a 100% wage hike falls short, leaving working and retired individuals below the poverty line.
In essence, the erosion of purchasing power, exacerbated by soaring inflation rates, paints a dire picture for Iranian households, necessitating urgent measures.
