The harsh unemployment figures have shocked the economy's leaders. The treasury did not expect such a sharp rise in unemployment; no one guessed that we were so close to the 300,000 unemployed mark.
The little growth there is stems from exports, thanks primarily to high-tech and electronics, managing somehow to survive, produce and export. Without it, our economic situation would be a lot worse.
Given this backdrop, it is worth recounting the tale of one small tech company located in Netanya - Neomagic Israel, a subsidiary of Neomagic Corporation of Silicon Valley.
Neomagic Israel develops components for the next generation of cellular telephones that facilitate real-time video transfer and 3D games. It employs 20 permanent and 10 temporary staffers, most of whom are engineers involved in development. Quality testing is conducted by a second Neomagic Corp. subsidiary in India, while the holding company in California takes care of the management and marketing sides of the business.
Because of the ongoing high-tech crisis, numerous companies in Silicon Valley decided to cut expenses by transfering their development centers to India, where the gross wage of a software engineer with four years experience amounts to $15,000 a year. The same engineer in Israel earns $60,000 a year, while in the United States, the engineer commands an annual salary of $70,000.
It is worth noting that the professional standard of the Indian engineer does not fall below that of his/her Israeli or American counterpart.
Some six months ago, the Neomagic Corp. also decided to cut back on costs, announcing the closure of its Israel operations. The remaining development operations were moved to India.
Neomagic Israel's CEO, Avidan Akirav, didn't take the news lying down, and successfully warded off the decree contingent on the Israeli center's ability to recruit six engineers from India who will come here on six-month sojourns but receive their wages back home.
Three months ago, Akirav contacted the Interior Ministry's branches in Netanya and Jerusalem to arrange a visa for the first Indian engineer. However, he ran headlong into Israeli bureaucracy in all its glory. He is being treated as a nuisance, and Interior Ministry officials are playing dumb, requesting an unlimited number of forms and approvals and concentrating on the art of foot-dragging.
They have all the time in the world; and they won't be moved in the slightest when one morning they come across a small item in the newspapers with the headline: "Another high-tech company in Netanya closes down; operations moved to the United States and India."
But perhaps there is one man who does care - Interior Minister Avraham Poraz. He recently announced plans to grant resident status to foreigners who make "a substantial contribution" to Israeli society.
In the case in question, the Indians aren't even planning to remain in Israel; they will be returning home in six months' time. But their arrival will keep some 30 engineers and technicians from joining the ranks of the unemployed or from emigrating - and that is certainly "a substantial contribution" to Israeli society.
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