Manufacturers Association of Israel president Shraga Brosh's forecast for the labor market in Israel is particularly pessimistic. He says that the layoffs at Intel are only the start, and the economy faces a "major wave of layoffs. They say we're a startup nation, but there have been layoffs in all industrial sectors, and it will be the same with the next wave of layoffs I expect," he remarked at a conference of the Ministry of Economic and Industry Foreign Trade Administration.
According to figures published by the Manufacturers Association, 2,225 industrial workers have been laid off since the beginning of 2015, amounting to 0.5% of the total industrial labor force. These layoffs were mostly in the high tech sectors, such as electronic components (1,205 workers laid off), electronic equipment for consumption and communications (865 layoffs), electrical equipment (835 layoffs) and machinery and equipment (785 layoffs).
Actually, according to an analysis by the Manufacturers Association, had the public sector not hired many new workers and expanded disproportionately to the population, unemployment in Israel would have reached 8%.
Brosh added, "Israel should produce 150,000 new jobs a year, but when production is going down and exports are going down, where do the workers go? They go to the public sector. The public sector will continue to be inflated more and more, until it collapses."
Brosh further alleged that one of the reasons for the reduction of industrial activity in Israel was the excellent conditions offered by other countries for the building of new plants. "All countries want to embrace Israeli companies, so that we switch to them. As an Israeli industrialist, I find this trend very alarming. This process has already begun, and when it will end is unknown. We all know that an enterprise that has already made the move and set up an overseas plant will also build its second plant overseas, not in Israel," he said.
Brosh summed up by saying, "The only way to change the situation and increase the growth rate is for the government, especially the Ministries of Finance and Economy and Industry, to realize that many more resources should be poured into encouraging growth and productivity. Much more can be done, including aid in investments, extensive technological training, and development of new export markets."
Published by Globes [online], Israel business news - www.globes-online.com - on May 5, 2016
© Copyright of Globes Publisher Itonut (1983) Ltd. 2016