Israel's Jobless Rate Up in First-half October Amid Second Nationwide Lockdown

Nati Tucker
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Shuttered businesses display 'For Rent' signs as many lockdown restrictions that impact sectors such as retail and tourism remain in effect, Netivot, October 29, 2020. For illustration purposes only.
Shuttered businesses display 'For Rent' signs as many lockdown restrictions that impact sectors such as retail and tourism remain in effect, Netivot, October 29, 2020. For illustration purposes only.Credit: Eliyahu Hershkovitz
Nati Tucker

The broadest measure of Israeli unemployment rose in the first half of October, as the second lockdown was being enforced, to 22.7% of the labor force – a lower rate than the 26.6% peak during the first lockdown in the first half of May, the Central Bureau of Statistics said Monday.

The bureau said 937,500 Israelis were unemployed in the first two weeks of October by the broad measure, which counts the jobless and those on unpaid leave. That was up from about 767,400 in the second half of September, or a jobless rate of 19.1%.

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The biggest increase in the rate was for those on unpaid leave, whose numbers jumped to 627,400 in first-half October from 507,400 in second-half September.

The rise tracks Israel’s entry in a second lockdown, which began September 18 and tightened further a week later, as well as the High Holy Days period that traditionally sees a slowdown of economic activity. On the eve of the second lockdown in early September, the broad rate had fallen to as low as 11.5%.

Although many restrictions that have impacted sectors such as retail and tourism remain in effect, the second lockdown mostly ended as of October 18 and is expected to bring a further lowering of the jobless rate.

On Sunday, further easing of the rules went into effect, including allowing some personal services conducted on a one-on-one basis to reopen.

The traditional unemployment rate, which includes only people over age 15 who have not worked for a single hour in the week prior to the survey but are looking for a job, rose to 5.1% in the first half of October, the statistics bureau reported.

The rate was up sharply from 4.2% in the second half of September – an unexpected drop when it had occurred, which might have been due to the onset of the holiday period. Nevertheless, the first-half October rate was the lowest since the second half of May, bureau figures showed.

The third category of unemployed that comprises people who lost their jobs before the onset of the pandemic last March but are not looking for work due to the crisis, numbered 104,900 in first-half October. It was up from 95,000 in late September and the highest level since the second half of May, bureau figures showed.

In their latest economic outlook, issued last month, Bank of Israel economists said that in their best-case forecast the unemployment rate would fall to 16.7% on average in the fourth (current) quarter, then fall gradually to 7.8% by the end of 2021. Their worst-case estimate is that the rate will average 20.2% in the fourth quarter and remain at an elevated 13.9% as late as the end of 2021.

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