Iran’s Misery Index highlights economic hardship in key provinces

A report by the Statistical Center of Iran reveals that the provinces of Kermanshah and Isfahan are facing the most economic challenges, topping the nation’s Misery Index. after five years of high inflation.

The index, which combines inflation and unemployment rates, is widely used to assess economic distress.

In Kermanshah, the Misery Index reached around 51%, while in Isfahan, it exceeded 49%, according to the report.

The high Misery Index figures show that Kermanshah and Isfahan had the highest combined rates during the summer, with inflation and unemployment more severe there than in other provinces. Isfahan’s situation is puzzling, given its status as an industrial hub.

While the exact reasons behind its high index ranking remain unclear, experts point to summer power shortages and an escalating water crisis as potential factors. These issues may have contributed to job losses in industrial and agricultural sectors, worsening the overall economic situation.

Reza Gheibi, an economic journalist, told Iran International that the economic hardship in Isfahan, an industrial hub, "rings an alarm for the entire Iranian economy".

He said: "The lack of foreign investment has led to decreased production and higher unemployment in the province."

U.S. sanctions imposed since 2018 have not only slashed Iran's oil export revenues and foreign trade but also undermined confidence needed for foreign investment.

The economic struggles are also evident in the inadequate minimum wage for the current year, which is set at around 109 million rials (over $170). This amount covers only 29.62% of the estimated cost of living for a typical household, calculated recently at about 368 million rials ($584) based on the official data.

The rising costs of essentials such as food, housing, healthcare, and education have made it increasingly difficult for workers to make ends meet.

Labor sociologist Pedram Ebadi describes the situation as a shift from poverty to absolute poverty for many workers. In his interview with Taadol website, he highlighted that most workers now live below the absolute poverty line, facing not only economic hardship but also job and income insecurity.

Ebadi argues that the government has failed to take meaningful action to address the growing poverty and has instead continued policies that do little to alleviate workers' struggles.

“Neglecting workers' livelihoods can lead to many other crises in society, including higher divorce rates, an increase in petty crimes, loss of work motivation—which could inflict irreparable damage on the country's growth and development—and countless other issues that cannot all be listed here,” he added.

Sanctions have played a significant role in elevating Iran's Misery Index. International sanctions, particularly targeting the oil sector, banking, and trade, have restricted Iran's access to global markets. It has resulted in reduced revenues and foreign currency shortages, sparking a weakening of the national currency, skyrocketing prices for essential goods, and increased inflation.