Year in Review

High-tech Wages Rose 4% in 2013

In Israeli’s tech industry, average salaries increased and job-seekers are finding employment faster, but the hardware sector is in decline and rising costs are pushing development work overseas

Salaries in Israel’s high-tech sector rose significantly in 2013, with average salaries up 4.1% compared to just 3.6% in 2012.

The figures are from job placement company Ethosia, which also notes that finding work in the sector became easier. According to the agency’s data, 11% of job placements in 2013 in the high-tech field, including biotechnology, were for new workers, compared to just 5% in 2012.

Personnel agency CPS Jobs says the biggest salary hikes were for software developers, especially in mobile and Internet computing. Wages for mobile and Internet developers rose 10% and 9%, respectively, in 2012, compared to 4% for software developers as a whole. And in Internet marketing, average wages rose 12%.

Demand was highest, CPS Jobs says, for mobile developers in the areas of virtualization, cloud computing and data storage and security. It added that jobs in the area of Big Data analytics were begging for workers.

But there’s a downside to the rising salaries that greater demand for workers brings. As the wages of Israeli programmers approach that of their U.S. counterparts, the local tech sector becomes less competitive.

Yoav Chelouche is a cochairman of Israel Advanced Technology Industries, an industry association, Israeli life sciences and technology companies — including startups with just 20 to 30 employees — are increasingly moving development operations to Croatia, Ukraine, Spain or Portugal in order to cut costs, .

High worker demand also reduced, from eight weeks to six and a half weeks, the average period of time it took job-hunters to find a position. While demand has increased at most tech companies, there were layoffs and pay cuts in the hardware field, especially in microchip and telecommunications manufacturing.

“Israel has no advantage in manufacturing compared to the Chinese,” said the chairman of the Israel Association of Electronics & Software Industries, Elisha Yanai. “What happened to us with textiles is happening to us with electronics.”

Headhunting firm Ethosia said the contraction in the hardware field decreased the average amount of time it took employers to fill open positions. “Most of those laid off in the wave of layoffs in the third quarter of 2013 have already found new jobs,” the agency said.

But while the average job search declined in 2013, a breakdown of the numbers according to the age of the job seekers paints a different picture. Job-seekers aged 27-30 needed just five weeks on average to find work. But their slightly older counterparts, job-hunters aged 35-38, needed nine weeks on average and job-seekers aged 51-54 sought employment for 46 weeks on average – 10 and a half months – before they were hired.

A high-tech workplace in Israel.
Ilya Melnikov