TechNation: Multinationals Boost Israeli Productivity, Pay Employees More

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Israeli high-tech workers. Rare is the Ethiopian-Israeli among them.
Israeli high-tech workers. Rare is the Ethiopian-Israeli among them.Credit: Alon Ron

Multinationals boost Israeli productivity, pay employees more

Israelis working for multinational companies – nearly all of them in high-tech – make on average 10% more than their peers do working similar jobs for local employers, the Finance Ministry’s chief economist said in a report released Monday. Labor productivity at multinationals is about 40% higher than for Israeli companies. “The contribution of multinational companies to productivity increases GDP by about 9%,” the report concluded. Nevertheless, only about 190,000 Israelis work for them, accounting for only 8% of the national labor force. In other countries surveyed by the treasury, multinationals accounted for 19% of total employment, on average. The report pointed to the government’s 2013 decision to grant state aid to chip maker Intel to upgrade its plant in Kiryat Gat, which found that enabling the U.S. company to expand would boost Israel’s overall productivity both by adding new jobs at the plant and by influencing productivity at nearby firms. (Tali Heruti-Sover)

Unit of India’s Wipro buys Israeli maker of aircraft parts

India’s Wipro Infrastructure Engineering signed an agreement Monday to buy HR Givon, an Israeli maker of metallic parts and assemblies for the aerospace industry, for what sources told TheMarker was 300 million shekels ($78.8 million) in cash. If correct, that would mark a 300% return for Ishay Davidi’s FIMI fund, which has owned 70% of Givon since 2008. “This acquisition will help WIN broaden its product portfolio, expand its global footprint and strengthen its ability to forge deeper customer relationships in the aviation and aerospace industry,” WIN said in a statement. Givon manufactures structural parts and assemblies for the Boeing 787 as well as F-15 and F-16 fighter jets. Under FIMI, the company upgraded operations by building two advanced manufacturing plants in Israel and opening a third in Washington state. The acquisition, which is expected to be completed next month, should open doors to new markets for Givon, especially as India has emerged as a major defense-export market for Israeli companies. (Uri Tomer)

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