This study examines the experience of Iran’s manufacturing firms in the past 15 years when the country was under international sanctions with various degrees of intensity. Contrasting the sector’s trends during two episodes of major intensification in 2012-2013 and 2018-2020 with the years preceding them suggests that by restricting access to global credit, technology, and product markets sanctions squeezed many firms on both supply and demand sides and slashed their productivity, though the effects were far from uniform. Some industries that depended on imported inputs and foreign technology were generally hit hard, while some others that relied more on the country’s own resources and regional export markets gained from a demand shift toward domestic products. These changes have been associated with enormous movements in relative prices. The rial depreciated significantly, producer prices rose, and real wages tumbled each time sanctions intensified. This encouraged employment despite initial shrinkage of output and declining investment. The result was job creation without growth, in sharp contrast with a jobless growth process that had prevailed in manufacturing before 2012. The data show that entry and exit of firms did not play a significant role in this shift. Rather, mostly exiting firms seem to have adjusted to the shocks and learned to survive.