Some 281,400 people - 10.8 percent of the work force of 2.6 million - were unemployed in the first quarter of 2003.

And, with the government economic emergency plan including elements that involve firings and early retirement for thousands, expectations are for unemployment to rise to some 300,000 by the end of the year.

According to the figures released yesterday by the Central Bureau of Statistics, only 54.6 percent of the working age population was employed, up slightly from 54.2 percent in the previous quarter.

The percentage of unemployed among men rose to 10.6 percent, from 9.9 percent in the previous quarter; while for women the figures were 11.1 percent and 10.5 percent respectively.

The number of unemployed looking for work for more than 6 months was up to 36 percent from 33 percent in the previous quarter.

Seasonally corrected data indicates a relatively high rise of 17,000 in the number of workers employed in business services, continuing the growth of the past few years. Gains were also posted in the construction and education sectors, with about 7,000 more workers joining each sector.

In commerce and automobile repair, there were large job losses - 19,000 workers, after a similar rise in the second half of 2002. Medical and welfare services recorded a 7,000 employee drop.

An average of some 416,000 new immigrants were employed weekly during the quarter and 54,000 were unemployed, out of a population of 829,000 new immigrants over the age of 15 who immigrated to Israel after 1990. The participation rate of new immigrants in the work force is higher than that of the veteran population, 56.6 percent to 53.7 percent.

The unemployment rate among new immigrants reached 11.4 percent - 10.4 percent among men and 12.3 percent for women. This was down from 12.2 percent in 2002 - 11.6 percent for men and 12.7 percent for women.

Social Affairs Minister Zevulun Orlev said the increase in unemployment and a rise in the number of recipients of guaranteed income will force the government to prepare a new economic emergency plan that creates jobs. He said the country's economic problem is not a result of too much welfare for the poor, but not enough jobs. Labor Party Secretary General MK Ophir Pines-Paz said the numbers were "the tip of the iceberg of the economic depression we'll be facing when the government's economic emergency plan lasses."

A new strike?

Meanwhile, Histadrut chief Amir Peretz has told unions and work committees to be ready for a new strike in the public sector, this time over the government's plans to strip the Histadrut of the management of the pension funds.

Hundreds of works committees' leaders attended a meeting at the Histadrut's Tel Aviv headquarters, where Peretz said the renewed public campaign was inevitable after the negotiations with Finance Minister Benjamin Netanyahu on the pension issue became frozen.

He attacked the employers for not taking the Histadrut's side in the dispute with the government. "The employers are being irresponsible when they don't press for protection of their employees' pensions," he said. "They should have risen up when they heard the steps the treasury is planning against their employees and the pensioners," he said. The one area where the employers did back the treasury is on the issue of raising the retirement age to 67, which the Histadrut opposed.

Peretz said the main thrust of the dispute between the Histadrut and treasury was over allowing pension funds to invest in the stock market - though he has said that, if the treasury protects the funds needed to pay pensions, any profits earned by the funds could be used in the stock market. The treasury wants the pension funds to be able to invest in the stock market as a source of capital for long-term investment in infrastructure projects.