Unemployment has never been higher in Israel as in the past year, amid the coronavirus crisis. Almost 800,000 unemployed people were registered in the second half of January. Most of them are classified at this stage as temporarily unemployed (on unpaid leave). But some have slim chances of of finding work immediately after the economy fully reopens.
The Bank of Israel has already warned that due to the coronavirus crisis some 200,000 Israelis may drop out of the labor force altogether.
Just when we need to mobilize all available resources to help the jobless, the most acute failures preventing the state from dealing with the issue properly are coming to light. The first and foremost is the very possibility to obtain reliable, updated figures about the extent of unemployment.
Several state authorities – the Central Bureau of Statistics, the National Insurance Institute, the employment service, the Tax Authority and others – each have their own unemployment figures. This fiasco has already led to paying out unemployment fees by mistake to nearly 400,000 ineligible people. It also makes it difficult to draft a correct policy to deal with the labor force crisis.
These lapses came about after the government enabled the various agencies to underperform and operate with no coordination for years. This went on due to the low unemployment rate, that existed, with Israel’s economy nearly at full employment most of the time.
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Public attention wasn’t directed at the way the agencies in charge of the employment market were operating and no effort was made to prepare for a rainy day. No agency or official studied the shortcomings in the labor market with a comprehensive view, or tried to correct them. Even when an effort was made to advance reforms, in most cases these effors got stuck due to political or militant trade unions’ pressures. The chaos in gathering unemployment data was compounded by the deficient handling of professional training and a lack of a policy for paying people on unpaid leave, which created a negative incentive that discourged people from returning to work. Instead of submitting a strategic plan for the labor market, the politicians are preoccupied with struggles for survival and are offering plans intended merely to shell out more ineffective funds that won’t help achieve economic recovery.
The above article is Haaretz’s lead editorial, as published in the Hebrew and English newspapers in Israel.