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A Picture of Israel 2024

The Taub Center, Israel’s leading nonpartisan research institute whose data-driven analysis is used to shape Israel’s socio-economic policies, has just released annual report A Picture of the Nation 2024 which focuses on important data in the areas of economics, labor, welfare, health, education, demography, environment and health.


The data indicate some measure of improvement in certain areas, like a rapid recovery of the growth in GDP, low levels of unemployment, rising levels of benefits for senior citizens, high life expectancy, and a rise in teachers’ wages alongside a decline in the number of students per teacher. In contrast, GDP per capita in Israel is very low, the cost of living is high, poverty rates are high, and there are inequalities among populations in terms of health and education.


To read the full report and learn more click here.


Macro-Economic Trends


Up until the outbreak of the war – the last two governments had similar levels of expenditure: In December 2022, there was a sharp increase in the expenditure of the civilian ministries (a phenomenon also observed in previous years), which is due to the effort to fully utilize the year's budget. With the outbreak of the war, adjusted civilian expenditure increased by NIS 5 billion in October relative to the same month in the previous year, and in November it grew by NIS 2 billion relative to the same month in the previous year. Surprisingly, the data for December, which are adjusted for the CPI and population size, were to a large extent similar to that in 2022 and 2023. However, since the beginning of 2024, there has been an upward trend in adjusted civilian expenditure relative to the previous two years.


The approved defense budget for 2024 stands at approximately NIS 117 billion as compared to around NIS 64 billion approved prior to the war. Based on the defense establishment's needs, defense expenditure in coming years is expected to be about NIS 20 billion per year higher than pre-war levels. According to the Bank of Israel, an annual increase of more than NIS 10 billion in the defense budget poses a risk to Israel's fiscal stability.

Labor Markets

Employment increased among both men and women in the Arab and Haredi communities: Among women, employment rates reached their highest levels ever for the second consecutive year. Overall, the employment rate for men in the summer of 2022 was 82%, the same as in the summer of 2019, while for women, the rate increased from 75% to 77%.


Unemployment due to economic causes is approaching its pre-war level: On the eve of the war, the unemployment rate was particularly low at 3.4%. This rate is calculated out of the labor force, which on the eve of the war constituted about 64% of Israel's population aged 15 and above over. The rates of workers on furlough, as well as the rates of those who had left the work force, were also very low. With the outbreak of the war, the unemployment rate remained stable, but the rate of those on furlough due to economic reasons rose to 6.3%. However, this rate is declining rapidly, and by April 2024, it was only slightly higher than the regular peace-time rate.


In November 2024, there was an increase of about 40,000 individuals who lost their jobs in the last two years and left the work force. This increase contributed to a 1.5 percentage point drop in the labor force participation rate, which happened at the same time. Welfare

There was a sharp increase in the number of unemployment benefit recipients as a result of the war: The number of unemployment benefit recipients was relatively low before the war, although it was on a slight upward trend. In October 2023, it more than doubled, and from December onward it has been on a downward trend.


There was a dramatic increase in the number of individuals who received care under the Victims of Terrorism Law: The permanent status of these individuals and the level of benefits they will receive will be determined at a later stage. The National Insurance Institute also provides a housing grant to people who voluntarily evacuated their homes to accommodations not funded by the state and a grant to evacuees who returned to their homes.


There was a decline in the number of evacuees in hotels, mainly among residents of the South: In the first months of the war, the number of evacuees to hotels was about 70,000‒80,000. Over time, the number has declined, primarily among residents from the South. Education

Israel is among the leaders in the rate of elderly long-term care (LTC) benefit recipients: In recent years, there has been a dramatic increase in the number of elderly individuals defined as needing LTC and who are receiving LTC benefits from the National Insurance Institute. Between 2012 and 2022, the number of recipients doubled, while the number of recipients of the old-age pension (who become eligible at the age of retirement) increased by only 40%. There is no information explaining this dramatic increase, nor is it known whether it was accompanied by a more rapid rate of deterioration in functioning. The number of recipients of LTC benefits by way of the health funds’ LTC insurance plans increased even more dramatically during this period — by two and a half times.


Israel has one of highest proportions in the OECD of individuals aged 65+ who receive LTC. Israel's ranking is due to the high rate of LTC recipients being cared for in the community. In terms of the rate of patients hospitalized in nursing homes, Israel has one of the lowest rankings. Health

The rate of government health expenditure out of GDP is among the lowest in the OECD: In 2022, Israel’s national health expenditure at current prices was NIS 132.6 billion, which constituted 7.3% of GDP and is far below the OECD average. This places Israel in the bottom third of OECD countries.


There has been a drastic decrease in first-time opioid prescriptions since the regulations were changed: Following a significant increase in opioid use in Israel, as reported in a study by the Taub Center, the Ministry of Health and the health funds began implementing some of the recommendations made by a committee established by the Ministry of Health and based on discussions within the health funds. Since the requirement for approval by a specialist was added as a condition for initiating treatment with fentanyl (the strongest opioid), there has been a sharp decline in the first-time prescriptions of the drug issued to members of the Clalit Health Services. Education

There was a significant increase in the proportion of special education students receiving the larger individual service basket: The per student budget for those in special education in separate schools ranges from NIS 42,000 to NIS 113,000 per year, while in integrated schools it ranges from NIS 20,000 to NIS 65,000 for students receiving an individual basket, and less for those receiving only an institutional basket.


Special education budgets have grown faster than regular education budgets: The special education budget increased sharply – from about NIS 11 billion in 2017 to NIS 16 billion in 2022, an increase of almost 47%, as compared to a 24% increase in the regular education budget. The number of students eligible for special education services also grew at a much faster rate than the overall increase in the number of students, although at a slower pace than the growth in the budget.







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