600,000 Israelis seen qualifying for unemployment pay

unemployment photo: Ariel Yarozlimksy

Apartments sold and rented

Monthly unemployment benefits are projected to reach NIS 4 billion. Over 100,000 people put on unpaid leave have registered on the National Insurance Institute site.

Since the coronavirus began, more than 100,000 new jobless Israelis have been registered on the National Insurance Institute website as eligible for unemployment benefits, and the number will undoubtedly grow rapidly. 28,000 new unemployed registered in a seven hour period today.

An analysis by Daphna Aviram-Nitzan, director of the Center for Governance and the Economy at the Israel Democracy Institute, found that the number of employees and self-employed fired or put on unpaid leave was liable to reach 600,000, which would raise the monthly cost of unemployment benefits to NIS 4 billion, assuming an average monthly unemployment benefit of NIS 6,200 per person, based on an average monthly salary of NIS 10,500.

The data gathered by Aviram-Nitzan are based on figures from the Central Bureau of Statistics and assumptions about the proportion of employees in each sector likely to become eligible for unemployment benefits. The number is composed of 80% of those employed in the arts, entertainment and leisure, hosting and food, and real estate broker sectors - about 280,000 people; 20% of those employed in most of the business sector, including commerce, transportation, industry, technology, and communications - about 300,000 people; and 60,000-70,000 self-employed.

Momentum that should be utilized

"The high cost of putting hundreds of thousand of employees on unpaid vacation highlights the importance of the transition to working at least partially from home in the public and business sector. Had this been practiced ahead of time, it would have saved the economy billions of shekels and enabled larger parts of the public sector to continue providing remote service to people, even in an emergency," Aviram-Nitzan says.

"The government should refrain from putting all public sector employees on paid vacation. It should carefully consider where options for working at home should be expanded. This is an opportunity for a real-time experiment, accompanied by measurement of output and performance, in order to prepare the spadework for working all day from home or remotely as a format for some employees when the crisis ends.

"There is a one-time opportunity now for employers to practice the model of working from home, which can be effective in a considerable part of the public service. There is momentum here that should be utilized. People have been trying for years to start a public sector pilot of working one day a week at home. What has prevented it up until now was concern about inability to measure output. I call on the government and the employers in the business sector to grab the chance to gain experience in this way of working. Recent days have proven that employees are able to work from home; you just have to devise the right format and adjust the labor laws to it," Aviram-Nitzan explains.