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Iran’s statistics agency says jobless rate dropped 0.5% in the quarter to December to 8.9%.

Iran’s unemployment rate has dropped to its lowest point in the past 25 years mainly because the country’s economically active population has shrunk because of the spread of the coronavirus pandemic, according to a report by the Iranian government’s statistics agency.

A Wednesday report by the Statistical Center of Iran (SCI) showed that jobless rate had dropped 0.5% year on year over the quarter to December 21 to stand at 8.9%.

The SCI said the figure was the lowest on record for Iran’s labor market since 1996 although it insisted that lower jobless rate did not necessarily mean that Iran had created more jobs over the past year.

"This declining trend does not mean more employment but it is due to the spread of the coronavirus disease which has caused many young adults to leave the labor market after failing to find a proper job," and said the report.

"We are witnessing a reduction in active population and as a result the jobless rate has been declining," it added.

SCI calculations showed that Iran’s economically inactive population of above 15-year-olds had increased to reach over 37.3 million people.

The agency said that jobs had increased by 122,000 over the quarter to late December to a total of 23.535 million.

Jobless rate was 23.6% among the youth between 15 and 23 years old, down 0.1% against the similar quarter last year, said the SCI.

The Iranian services sector was responsible for 49.9% of the jobs in the country over the quarter, followed by manufacturing and agriculture with 34.7% and 15.4%, respectively.

Some 20 out 31 Iranian provinces had reported single digit jobless rates over the three months to late December, including Razavi Khorasan in the northeast where unemployment was lowest in the country at 5.3%.

The highest jobless rate of 15.3% was recorded in Hormozgan Province on the Persian Gulf coast, said the SCI.