GDP Fell 3.9% in First Quarter of 2009

Unemployment reached 7.8% in April, expected to hit 8.5% next year

Israel's gross domestic product fell in the first quarter of 2009 by 3.9%, in annualized terms.

This comes after a 1.6% drop in the last quarter of 2008 and a 0.7% rise in the third quarter, the Central Bureau of Statistics reported yesterday.

The numbers are all in fixed prices, and account for inflation and seasonal variations.

Business product fell 5.4% in the first three months of the year.

Unemployment reached 7.8% in April, the bureau also reported. This figure includes only those who did not work even a single hour in the week the survey was taken, but still actively looked for work over the previous four weeks. Actively looking for work is defined by signing up with the Employment Service or applying for a job directly.

To meet the criteria, jobseekers must be able to start work the same week they are offered a job.

The total number of jobseekers hit 240,000 for the quarter. In April 2008, the jobless rate was 6.1%, or 188,000 people.

Unemployment has been growing steadily since January, when it was only 7.1% and jumped to 7.4% in february. The Finance Ministry expects unemployment to average 7.6% for all of 2009, though in 2010 it is expected to hit 8.5%.

The drop in GDP in the first quarter of the year reflects a 37% drop in exports of goods and services, as well as a drop in investments.

Consumer spending fell by 3.4%. Imports dropped sharply, by 46%.

These numbers are the corrected numbers for the quarter. The preliminary figures, released May 17, showed only a 3.6% drop in GDP.

The preliminary numbers are released six weeks after the end of the quarter, and the adjusted statistics come out four weeks later.