Those Israel Defense Forces soldiers, particularly reservists, deployed in the south as part of Operation Cast Lead are in some measure making up economically for the residents who have fled the area.

"Many reserve soldiers come with their own cars, stock up in those stores that are open, go out to get a treat for the guys, order take-out food and in some measure make up for the customers who have left," said Yisrael Ben-Cnaan, the head of the Be'er Sheva Chamber of Commerce and Industry.

There is also an increase in telephone sales. "People who have not done so before and who now prefer not to go out in the street are buying over the phone," Ben-Cnaan said. Food deliveries, such as pizza, are doing quite well, he said.

Ben-Cnaan estimates that there is a 25%-30% drop in sales in the south, in addition to the slowdown caused by the economic crisis. He says 25% of Be'er Sheva businesses are closed down completely, with half the businesses shutting down when it turns dark.

The situation is even worse in other towns. In Sderot, only 60 out of 600 businesses are operating, according to Dan Dahan, the chairman of an organization of local Sderot businesses. Most of those still operating are in the food business or provide services, such as banks, he explained.

Manufacturers say their workers have a hard time returning to work after a warning siren: They lack concentration and worry about their children - which means productivity is down. However, all the factories in the area are in operation, except for two.

Last week, approximately 70% of workers showed up, though the figure decreased as the weekend approached. However, it seems much of the increased absenteeism was related to previously scheduled vacations, to coincide with the new year celebrations.

The question is how many workers will return from their vacations this week.

It is still too early to estimate the total damage, said Yehuda Nasradishi, the head of the Israel Tax Authority. Most of the assessors' reports have yet to reach the offices in Jerusalem. As to indirect damages, such as loss of revenues or income, he said the treasury and other relevant ministries have yet to decide on compensation, though such a decision is expected to ascertain what will be reimbursed, how and how much.

As to why the model of indirect compensation used in the north has not been implemented in the south, the answer is clear. The number of residents involved is much greater, as would be the cost. Expanding the region for indirect damages to a 30-kilometer radius from Gaza would cost tens of billions of shekels, Nasradishi said. In addition, it would be very hard to differentiate between the drop in income and sales from the war and those stemming from the general economic slowdown.

To illustrate, he pointed to the 8-storey building hit in Ashdod last Thursday. About 50 or 60 cars were damaged and 30 families left their apartments. They had to be put up in hotel rooms. Only today will engineers decide whether the building is still inhabitable.