While Israel faces record unemployment due to the coronavirus crisis, the labor, construction and welfare ministers agreed on Tuesday to import significantly more workers, raising the limit on Palestinian laborers from 64,000 to 80,000 while nearly doubling the number of migrant workers from 16,500 to 32,500.
The cabinet is expected to approve the move on Sunday.
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The decision to increase the quota came in response to lobbying by contractors, who claim the lack of non-Israeli workers is causing a decrease in housing starts and making it hard to complete on schedule projects that were delayed by the recent lockdowns. They estimate the crisis led to a sharp decline of 15,000 housing starts, which could cause a severe housing shortage in the coming two years. Other causes of delays in housing starts include a slowdown in the Israel Land Authority’s sale of housing sites and failures to speed up the planning process.
Migrant workers bring in a lot of money, compared to Israelis whose training costs the state 20,000 shekels ($6,000). Employers have to pay an annual fee of 35,000 shekels – 20,000 in application fees and 15,000 (15% of the worker’s salary) employment tax. These levies are factored into housing prices for buyers.
Because of the unemployment in Israel, the agreement included a stipulation that the Finance Ministry set up a team to review the possibility of increasing the quota of Israeli workers in the construction industry, and to address all necessary issues, like training, mapping out jobs and easing regulations.
Unemployment is close to 12%, according to the Central Bureau of Statistics and 21% according to the Employment Service. Over 500,000 Israelis who lost their job because of the coronavirus crisis have yet to return to work.
Despite all this, the state has allowed migrant workers to enter Israel. It approved 700 Jordanians for work in Eilat hotels. The cabinet had decided before the crisis that if the unemployment rate in Eilat topped 7.5%, the quota of 2,000 workers would be canceled. Thus, these workers would be eligible to remain in Israel only until October 20. An interministerial committee must decide by mid-September whether to extend their stay, based on the latest Eilat unemployment rate.
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The cabinet also approved bringing in 2,500 caregivers in July on top of the 56,000 already in Israel. There is no quota on caregivers.
The prevailing claim is that Israeli workers aren’t interested in or capable of joining the fields that migrant workers dominate. But this explanation omits the state’s failure ever to implement a determined policy of providing incentives for Israelis to work in these fields. It either stopped creating new programs or even discontinued training programs for anyone interested.
In February, the state suspended a training program run jointly with the Histadrut Labor Federation to train Israeli construction workers. The program, which ran for two years, had been allocated 80 million shekels. Itzik Moyal, chairman of the Construction Workers Association, said that in the wake of the budget freeze there are only 50 students in construction training courses. He said 300 people are on the waiting list and everyone could be accepted if the budget would be unfrozen.
It should be noted the program was designed mainly to train construction managers. Attempts to find young people as construction workers didn’t go well, despite efforts made both among Jews and Arabs.
The Finance Ministry said: “The deal with the fund for promoting and developing the construction industry in Israel ended, after several extensions by the state. Pursuant to the cabinet decision, an interministerial work team headed by Finance Ministry director general Keren Turner Eyal and Ronen Peretz, the acting director of the Prime Minister’s Office, a comprehensive government plan is being developed to handle the employment issue and absorb job seekers. One of the main tools being examined for the plan is expanding professional training and retraining.”
The committee also suggests that incentivizing employment in the construction industry will be done using new tools. One one is the decision that engineers will also be able to be construction managers. Currently, an engineer is required to have two years of experience to be appointed construction manager.
Leaders in the construction, caregiving, tourist and agricultural industries say the need for workers is urgent and they don’t have the option of waiting for a training program to be completed. A request by agriculture employers seeking an additional 4,000 migrant workers was rejected in recent weeks. Likewise, they claim, Israelis aren’t interested in working in these fields even when they are offered a relatively high salary.
However, Dr. Samir Mahamid, the mayor of Umm al-Fahm, said: “I think the cabinet decision to import tens of thousands of migrant workers is a mistake. We have many unemployed people in the country in general, and in the Arab community in particular. Umm al-Fahm alone has 7,100 unemployed people. Some of them are experienced construction workers, while others could be trained.”
He rejected the claim that Israelis aren’t interested in working in these areas: “The state should create incentives to attract workers instead of paying unemployment benefits.”
For example, he said, the state could extend the offer of benefits for doing “preferred work” beyond demobilized soldiers. Alternately the state could continue paying half of people’s unemployment benefits if they work in one of these fields, similar to a proposal the Tourism Ministry made to the Finance Ministry.
Yehuda Katav, vice president of the Bonei Haaretz contractors’ association, said, “The association called on and continues to call on the government to support budgeting massively to attract Israeli workers to the industry in all types of jobs.” He added, “We believe the current crisis could make more Israelis work in these jobs.”