Employed and happy about it
When Benjamin Netanyahu implemented the revolution in 2003, he was criticized sharply. He cut the budget, trimmed the "fat man" (the public sector) and slashed guaranteed income benefits, while also encouraging people to join the work force by reducing income tax. In addition, he implemented a series of reforms that provided high-octane fuel to the economy's growth engine.
The "socially" oriented said at the time that the result would be a deep recession, increased unemployment and a social disaster. But the years have passed, and instead of recession we got growth. Instead of increased unemployment, there was a sharp drop, from 10.7 to 7.5 percent. And instead of a social disaster, hundreds of thousands of Israelis joined the work force, their standard of living rose, and economic disparity between the poor and the rich shrunk in 2006 for the first time in many years.
But the "social" types still refused to admit their mistake, and instead found a new myth to parade. They began claiming that the source of increased employment was solely the high-tech industry, while in other sectors, growth was limited to low-pay, part-time jobs - and therefore, there was no achievement and no benefit.
But it now appears, according to new data published in these pages, that demand for workers spans all sectors of the economy: industry, food and hospitality, business services and many more. Because when it rains, everyone gets wet - in the good sense.
And a statistic that is even more important: Wages are on the rise. Because when demand increases and employers insist on filling positions, workers' bargaining power increases. They can demand higher wages - and get them. And wages did indeed increase by 2 percent in 2006, and will do so by another 3 percent in 2007 - even before a new wage agreement is signed in the public sector.
The increased demand for workers mirrors the economic growth, which has remained an impressive 5 percent annually for four years. Some 300,000 Israelis joined the work force during this period and moved from despair to self-respect.
The high demand for workers and the accelerated growth bring the economy nearer to the brink of full employment. And this is what inspired the governor of the Bank of Israel to increase interest rates this week - to cool the heated economy, thus maintaining low inflation rates.
Like us on Facebook and get articles directly in your news feed