Israel's Broad Jobless Rate Held Steady at 14.6 Percent in Late November

The numbers add to concerns that the labor market isn’t recovering from the country’s second lockdown that began in mid-September

Nati Tucker
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Pedestrians in Jerusalem, December 17, 2020.
Pedestrians in Jerusalem, December 17, 2020.Credit: Emil Salman
Nati Tucker

Unemployment figures released by the Central Bureau of Statistics on Monday provide worrying new evidence that the labor market won’t bounce back from the second coronavirus lockdown as quickly as it did from the first.

The bureau reported that its broadest measure of joblessness held steady in the second half of November, compared with the first, at 14.6 percent, even though Israeli schools resumed classes in the second half of the month.

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The figure confirmed fears that the unemployment rate will remain elevated for some time. Last week, Bank of Israel Governor Amir Yaron warned there were growing signs – among them that some 200,000 people have not yet returned to their jobs – that the economy now faced “structural” high employment.

The Finance Ministry forecasts an average unemployment rate for 2020 of 15.1 percent, assuming no serious restrictions on the economy are introduced in the remaining days of this year. If so, the average will rise to 15.3 percent.

The bureau said about 597,000 Israelis were jobless in the second two weeks of November even though the coronavirus cabinet approved measures during that time to increase employment. These included reopening street-front stores from November 4 and hotels in the resort areas of Eilat and the Dead Sea as “green islands” from November 19. Some shopping malls were reopened on a trial basis on November 24, and the number has since been expanded.

Still, many businesses remain closed, such as gyms and events halls.

The bureau’s broad unemployment rates, introduced at the onset of the pandemic to better reflect the reality of the labor market, has three components. The first is the traditional and narrowest definition of people out of work and actively looking for a job. That rate rose to 5.4 percent of the labor force in the second half of November, or about 213,000 people, from 4.8 percent in the second half of October.

The increase shows that more Israelis are now being designated as really unemployed as opposed to being on unpaid leave with the expectation of getting their old jobs back eventually. The official rate was the highest since the first half of September.

The second component of the broad measure is people not working due to the coronavirus, mainly those who have been put on unpaid leave. Their numbers continued to decline, to 264,000 in the second half of November, from 306,000 in the first half, but the relatively moderate decline points to continued business uncertainty among employers and concerns that the government will impose a third lockdown.

On Monday, amid concerns about rising infection rates, the coronavirus cabinet barred entry to foreign nationals into Israel and mandated a 14-day quarantine in a designated COVID hotel for all Israelis returning from abroad.

The third component of the broad jobless measure is Israelis who were laid off starting in March due to the coronavirus but aren’t actively seeking a job. That group’s number has surged toward 120,000 in the second half of November, from just over 95,000 in the first half.