Civil Servants’ Pay Now Double Israel’s Average Salary

The average for civil servants in 2016 approached $5,000 at current exchange rates, a government report shows, as port workers continued to do well

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Ashdod Port
Ashdod PortCredit: Emil Salman

Salaries for Israel’s civil servants grew 2.4% in 2016 to an average of 17,100 shekels ($4,940 at current exchange rates) a month, nearly double what the average salaried worker earned, a report by the Finance Ministry's wages commissioner shows.

The report released Wednesday found that over the decade to 2016 civil servants’ wages had risen 44.6% before inflation and 22.9% including it, while in the private sector wages had risen no more than 6% including inflation.

In 2016, overall pay in the public sector, including government-owned companies, climbed 2.7% including inflation to 15,800 shekels a month versus 9,550 on average in the labor market.

Public-sector pay – especially at state-owned companies like the ports – has been the subject of public debate for years. But despite efforts at reforms at the ports and the Israel Electric Corporation, powerful unions buttressed by government monopolies give workers immense bargaining power.

On Wednesday, as the treasury report was being released, administrative workers at Ashdod Port called a slowdown, just a week after management made two key concessions to unions in exchange for industrial quiet. On Wednesday, management asked the Be’er Sheva Labor Court to order staff to resume normal work.

Much of the salary increase that civil servants have enjoyed over the last decade is in salary supplements, as against base pay. Supplements have doubled during the period while base pay has eroded 4%.

The problem, as treasury wages chief Eran Yaacobi said at a press conference on Wednesday, is that for all the pay increases the civil service has enjoyed, there has been no clear improved productivity or service. Also, no mechanism exists for measuring Israeli productivity versus other countries, he said.

In any case, the civil service grew by 10,700 people in 2016, or 3.8%, to 350,000. That meant that about 20% of the Israeli labor force was employed by the government, down from 23% in 2006 but higher than the 18% average for countries in the Organization for Economic Cooperation and Development, the report said.

In state-owned companies the average pay of 55,000 employees rose by 1,000 shekels a month to 22,900 in 2016, the report said. But behind that number were wide variations in pay.

The top average salary for government companies was at Haifa Port, 31,000 shekels a month, while at Ashdod Port it was 28,000. But one unnamed dockworker earned 98,000 shekels a month on average.

At the IEC, the average was 27,700 shekels, with the CEO’s pay at 91,000. The highest monthly salary for anyone in the public sector was for an unnamed employee at the Bank of Israel, 119,000 a month. The bank, for its part, said the money did not reflect actual pay but a one-time social benefit paid in connection with “an incident that occurred several years ago.”

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