Analysis

Shabbat Costs Israel Billions of Dollars Every Year

The ultra-Orthodox parties are demanding even less work on Shabbat. If they win, Israel has a lot to lose

An employee at the Phoenecia glassworks factory in Yeruham in 2016. Phoenecia May have to lay off its 240 workers.
Natan Alpert / GPO

Work on Shabbat, the Jewish day of rest, has become the hot topic of Israel’s coalition negotiations. The ultra-Orthodox parties’ strong election results whetted their appetites. Consequently, United Torah Judaism handed Prime Minister Benjamin Netanyahu’s Likud party an unusually demanding list regarding Shabbat – forbidding all violations of Shabbat that don’t entail saving lives; sanctioning private entities via heavy taxation for violating Shabbat; appointing a legal entity to enforce Shabbat laws; permitting work on Shabbat only for workers who are not Jewish; and appointing one of the party’s MKs as deputy minister for issuing Shabbat work permits.

It’s not clear which demands will make it into the coalition agreement, but the direction is clear: The status-quo regarding Shabbat is going to be moved sharply in favor of religious conservatism. The first indication of such is here – the threat that the Yeruham-based Phoenicia glassworks factory will be shuttered and its 240 workers laid off due to an ultra-Orthodox boycott of the factory’s products, which the community launched because the factory’s furnace operates seven days a week. If a factory that cannot shut off its furnace, and thus operates with a permit on Shabbat, is under threat of closure due to a boycott, it’s clear that any economic activity on Shabbat – even the most justified – is not secure. Some of Israel’s biggest, most important factories operate on Saturday, including factories that belong to major international corporations, which clearly won’t hesitate to leave Israel if their manufacturing operations here are threatened.

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Contrary to the impression created by the law allowing some minimarkets to operate on Shabbat, Israel’s economic activity on the sabbath is much more than a handful of 24-hour supermarkets and some malls. Israel’s economic operations on Shabbat are massive, and they’re crucial to Israel’s economic output and GDP. Impacting economic activity on Shabbat is likely to cost the country tens of billions of shekels.

600,000 Israelis work on Shabbat

No orderly study has ever been conducted detailing how much work Israelis conduct on Shabbat in Israel. The little we could find comes from peripheral studies, such as a 2013 National Economic Council plan to make Sunday an additional day of rest. That proposal was rejected as too expensive, but it also includes an estimate of how much a full day of rest costs.

That proposal found that a day of rest would mean sacrificing 2.7-3.5% of the GDP, or 40 billion shekels ($11.2 billion) a year. While this figure relates to making Sunday a day of rest, the cost of fully keeping Shabbat would be higher, given the proposals to entirely outlaw all economic activity whatsoever.

There’s no question that a weekly day of rest is needed, but Israel’s insistence that everyone keep the same day of rest, even to the extent of refraining from work that needs to be conducted on Saturday – in the case of Phoenicia, for instance, or that many people want to happen on Saturday – such as some commerce and leisure activities, means Shabbat has a much larger economic impact than days of rest in other developed nations.

A report by the Israel Democracy Institute that it conducted when the minimarket law was in the works found that some 600,000 Israelis work on Shabbat, including 400,000 Jews – a full 13% of Israel’s Jewish workforce. Contrary to some assumptions, people who work on Shabbat come from all socioeconomic backgrounds, and include people with high incomes.

A significant number of people who work Saturdays are also unionized – meaning they’re among Israel’s stronger employees – as do a large number of self-employed.

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Some of these workers have permits to work on Shabbat, which the industry, trade and labor minister issues. Entire fields of employment have permits to work on Shabbat, including security, animal care, hotels and hospitality, water utilities, restaurants, medical factories, geriatric and pediatric care facilities, synagogues, lifeguarding, firefighting, drilling, sewage, and ice production.

The lion’s share of these permits were issued soon after the founding of Israel, when ideology concerning religious matters was more moderate. In addition, specific factories also have work permits, such as the Israel Electric Corporation and Phoenicia, since they supply important services or their production equipment cannot be turned off.

The Israel Democracy Institute found in its study that most Israelis working on Shabbat are doing so without a permit, in other words illegally. And while they receive extra pay for their work, at least some of them suffer harsh labor conditions, working an average of 60 hours a week. An estimated 92,000 people work seven days a week, not ever enjoying even one weekly day off.

The large number of Israelis working on Shabbat is evidence of how much work needs to be done on Shabbat. Entire industries, namely commerce and entertainment, are based on weekend consumption. In the developed world, the loss of GDP from a break in the regular work routine is offset by consumers going out for entertainment.

This offset hardly exists in Israel on a comparable scale, and now Israel’s ultra-Orthodox politicians are threatening to end it altogether.

Furthermore, it’s not clear whether they intend to halt all Saturday entertainment as well, as entertainment is not a matter of life and death. If Israel’s entertainment industry is impacted, the blow to Israel’s economy will be particularly significant; a very conservative estimate is an annual loss of 40 billion shekels.

Why build a metro for only six days a week?

But regardless of what may happen to the status-quo, Israel already sustains significant economic losses from the national observance of the sabbath, primarily due to the lack of public transport on Friday evening and Saturdays.

Economists who focus on transportation issues agree that the lack of public transport increases inequality, by hurting the weaker socioeconomic classes that can’t afford a car and thus find themselves stranded one day a week. This lack affects Israelis living in outlying areas, particularly the Arab community.

Beyond the issue of inequality, there’s the question of how much damage the lack of public transport on Shabbat actually causes, as it’s not entirely clear what the demand is.

Throughout the developed world, public transportation operates through the weekend but on a reduced schedule, indicating that demand exists, albeit to a lesser extent than on weekdays. In Israel the demand is lower still, because a certain percentage of the population abstains from using vehicles as part of sabbath observance.

However, there is no definitive estimate how much demand there would be for public transport on Shabbat, even in non-religious areas, due to the limited commerce on Shabbat. It’s a vicious circle: Limited public transport leads to limited commerce, which in turn limits demand for transport.

And then there’s the wasted investment in public infrastructure. To invest 150 billion shekels in a light rail or metro line that’s used only six days a week limits the return on investment. That said, it costs money to run a light rail or metro, and running them may not pay off if demand is low on Saturdays.

That said, there’s overwhelming agreement that Israel’s main transportation problem is during the week, when traffic is heavy and public transportation is overburdened. But the midweek problem may in fact be impacted by the Shabbat issue – many households find there’s no choice but to have at least one car, due to the lack of public transportation on Shabbat.

And if you already have a car – which are particularly expensive in Israel, partly due to the high tax rate – it’s a pity to leave it parked all week long.

Not everyone agrees with this analysis. Some counter that at least one car per household is standard in the developed world.

While there may be some argument about the impact of the lack of public transport on Shabbat, there’s no question that the inability to do infrastructure work during the day of rest costs Israel dearly. This prohibition – the inability to work on the Yehudit Bridge over Tel Aviv’s central Ayalon Highway, or to conduct infrastructure work for the Israel Railways, for example – has no parallel in the developed world.

There’s no alternative to weekend infrastructure work. Work at night is limited to approximately five hours at a go, and if you need to spend 18 hours building a bridge, that means closing down a major traffic artery during peak rush hour periods.

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A few years ago, Israel Railways estimated the cost of not being able to conduct infrastructure work over Shabbat. This cost includes shutting down major traffic arteries during peak use hours midweek, or taking seven times as long (the 35 work hours over Friday and Saturday need to be split up into five hours of work at night instead).

The economic implications are massive. The railways didn’t provide an exact figure, but it apparently totals tens of billions of shekels a year.

Currently, tunnels are being dug for a light rail in Tel Aviv, and work will begin on a broader metropolitan metro system within the next few years, too. The municipality of Bnei Brak – a city near Tel Aviv with a large ultra-Orthodox population – already tried to halt light rail work over Shabbat, and after the court ruled against the municipality, the latter countered by shutting the water supply to work sites. It should be noted that the light rail’s digging machine cannot be turned off – it could cause the tunnel to collapse, and endanger human life in the process. In any case, trying to stop light rail construction for one day a week is insanity.

Even though there hasn’t been a comprehensive study on the cost of observing the Shabbat prohibition against work, the bits and pieces that emerge from other studies – the threat to factories operating on Shabbat, the lack of commerce on Shabbat, the lack of public transport on Shabbat – indicate that the cost is tens of billions of shekels a year, at a minimum. And that’s before any future demands by the ultra-Orthodox disrupt the status quo on Shabbat.