The economic crisis spawned by the coronavirus pandemic has hit Israel’s lower-middle class the hardest, according to a new analysis by the Bank of Israel.
The analysis, which compares Central Bureau of Statistics data from 2019 and 2020, found that Israelis within the third to seventh income deciles, and particularly those in the fourth and fifth deciles, were more likely to have lost their jobs. These deciles cover salaries between 5,500 and 8,000 shekels a month.
The report, presented to the government’s employment committee, indicates that the profile of the people who lost their jobs in the coronavirus crisis isn’t much different from those who lost their jobs in 2019. The report takes a broader interpretation of unemployed, and includes people on unpaid leave, people who aren’t currently looking for work, and those who looked but gave up.
Unlike previous analyses, this report found that young people and low-skilled workers are not overly represented in the current unemployment wave — no more so than they were among people laid off in 2019. Likewise, the percentage of elderly unemployed among the total is no different than it was last year.
They also have a similar education profile. Those unemployed in May 2020 had an average of 15.1 years of education, versus 16 years as of May 2019.
However, this does not mean that the crisis passed over younger Israelis at the beginning of their career. Unemployment peaked at more than 1 milllion in May, and hundreds of thousands of people are still out of work. In general, people beginning their careers have trouble finding their first job.The main challenge at the moment is the reduced demand for employees. The number of open positions plummeted, and the ratio of job seekers per available position is now much higher.
Beyond the culture and entertainment industries, which have not yet reopened, or hospitality, which has been placed under strict limitations, many of the jobs lost are in usually solid fields such as real estate, banking, insurance and financial services, information and communication.
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The people least affected by the crisis are upper-middle and upper-class Israelis — those in the ninth and 10th income deciles, found the report. They accounted for only 12% of all unemployed as of February 2020 and in all of 2019. In May 2020, once the crisis was in full force, they accounted for only 9% of all unemployed. Some 97% of people earning incomes in the 10th decile in March-May 2019 were still there in March-May 2020. This was true for 91% of people in the ninth decile.