Iran’s president has been accused of leaving the country exposed to a second coronavirus outbreak after he relaxed social distancing rules in the face of concerns that as many as 7 million Iranians had been left jobless or suffering wage cuts because of the restrictions imposed by the government over the last month.

Hassan Rouhani has urged millions of low-risk businesses to reopen and lifted travel restrictions within provinces. Most businesses in Tehran are not due to reopen formally until 18 April, but travel has already intensified, leading to a build-up of traffic.

Surveys cited by the government showed that a third of people are experiencing financial problems.

Ali Rabiei, Rouhani’s spokesman, told the Isna news agency that the Covid-19 crisis had affected 3.3 million official employees through dismissal, suspension or reduction of wages, with a further 4 million self-employed also feeling its impact.

In common with most world leaders, Rouhani is wrestling with the competing needs of collapsing living standards and public health. Iranian officials describe it as a dual policy of “saving lives and providing bread”.

He is also operating against a backdrop of US economic sanctions and public scepticism about official government statistics on the spread of coronavirus. Schools, religious services, mass gatherings and many shops remain closed and Rouhani has said if the position did not improve he expected the existing closures to remain in place through Ramadan.

Hassan Rouhani at a meeting in Tehran of a national committee tackling the coronavirus outbreak in Iran. Photograph: Anadolu Agency via Getty Images

He urged people to use private cars after there were crowded buses on the first day of the relaxed rules on Saturday. The metro has called for “smart distancing”, although what this means in practice is not clear.

Iran’s medical system organisation expressed concern, saying smart distancing “was being introduced without considering the scientific and executive justifications for the project, or the threat that the past efforts of all people, officials and medical staff will be wasted”.

The Tehran city council chairman, warned the reopening of business might lead to “a second wave of coronavirus”.

Ali Maher, the planning deputy of the Tehran coronavirus taskforce, said the Rouhani government has been shifting between two different approaches against the spread of the virus, one of mass immunity and the other of implementing lockdowns and quarantines.

The signs of pressure on the government are growing. In an unprecedented step, union leaders have refused to back a proposed 21% increase in the minimum wage – well below the current 40% inflation rate.

Ministers are offering individual loans to those suffering most, but even that help is being criticised, as the monthly repayment instalments will attract 12% interest.

Newspapers have also been dealt a heavy blow, with the government proposing to ban all but online newspapers temporarily on the basis paper might transmit infection. The plan, subsequently withdrawn, led to warnings of mass permanent newspaper closures. Redundancies, including in prestigious reformist newspapers such as Etemad, have gone ahead.

Tragedies, including the death of three generations of men in one family, are being publicised in a bid to underline the seriousness of the crisis. A mother and son were reported to have committed suicide after the father died.

There are also growing reports of domestic violence, with one Tehran counselling service saying it had taken 4,000 calls in the last few days. Children stuck at home without education do not have the money to afford the internet required to download lessons.

The health ministry’s latest statistics on Sunday showed a continued de-escalation of coronavirus cases, with 4,474 now dead and 71,686 infected. The government is pointing to successive falls in the daily numbers of those dying and infected.

Figures on Sunday showed 117 had died in the previous 24 hours. The number of newly infected was 1,657, down from 2,875 11 days ago. The figures have prompted Rouhani to boast Iran has responded better to the crisis than Europe.