Iran’s economy entered the year 2026 while many economists and regime-affiliated research institutions warned that the country has entered an unprecedented stage of livelihood crisis, chronic inflation, and expanding poverty. According to experts, this situation would not be easily controlled even if conflict were to stop and external pressure were to decrease.
At the “Iran Economy Outlook 2026” conference, reported by the state-run daily Donya-e-Eqtesad, economists presented a bleak picture of the country’s economic future, in which recession, inflation, unemployment, and the collapse of household purchasing power have reached a dangerous level.
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Masoud Nili, a regime-affiliated economist and former government economic advisor, warned that Iran’s economy has moved beyond chronic crisis and has now entered a stage where crises are openly emerging. Citing official data from the Statistical Center of Iran, he said inflation in some sectors has exceeded 100%, and even if conflicts end and political tensions ease, Iran’s economy will not return to normal conditions any time soon.
According to Nili, Iran’s inflation structure has entered a phase in which controlling it is far more difficult than in previous periods. He stressed that reducing inflation from very high levels is no longer possible through conventional monetary and fiscal policies, and that Iran’s economy is entering a dangerous cycle of inflationary expectations and continuous devaluation of the national currency.
At the same time, the labor market crisis has taken on new dimensions. Nili stated that in a country with a population of about 87 million, the number of employed people is less than one-third of the population, and between 2019 and 2025, despite an increase of nearly five million people in working age, net employment has remained almost unchanged. He added that more than 5.5 million people have joined the inactive population, a figure indicating widespread despair in finding jobs and the withdrawal of a portion of society from the labor market.
In the same meeting, Hojjat Mirzaei warned about Iran’s economic growth outlook and predicted that the country’s economic growth in 2026 would be between -8.8% and -10%, a figure that could worsen further if oil exports decline further.
He emphasized that intensified sanctions, disruption in foreign trade, currency shocks, import restrictions, government budget deficits, rising transportation costs, and internet outages have all led to a new wave of inflation and unemployment—a wave that directly targets Iranian households’ livelihoods.
Mirzaei also warned that if the current situation continues, between 3.5 million and 4.5 million more people will fall below the poverty line, and the number of poor people in Iran will exceed 40 million—a figure that could involve nearly half of the country’s population in poverty.
Official reports and economic studies in recent months have also provided clear signs of worsening living conditions. Continuous increases in food prices, housing rent, medicine, and healthcare services have pushed a large part of the middle class toward poverty. In many cities, the cost of renting a small apartment exceeds the average wages of workers and employees, forcing households to spend most of their income on necessities.
At the same time, the depreciation of the rial and the continuous rise in exchange rates have imposed a new wave of price increases on markets. Experts say that continuing this trend could lead to the closure of more production units, rising unemployment, and a deeper economic recession.
Meanwhile, the situation of informal labor has also been described as critical. According to statistics presented at the conference, about 39% of Iran’s workforce is employed in the informal sector—a group without insurance, job security, or social protection, and more vulnerable than others to economic shocks.
Hossein Rajabpour also stated at the meeting that after the 12-day war in June last year, the positive trend in the labor market stopped, and the industrial sector experienced the largest decline in employment.
Taken together, these indicators show that Iran’s economy is no longer facing a temporary recession or ordinary crisis but has entered a stage of structural crisis whose consequences are visible in the daily lives of millions of citizens—from shrinking household livelihoods and rising labor migration to expanding poverty, inequality, and social despair.
