The Labor Market: An Overview
Author: Hadas Fuchs, Gil Epstein Policy Research

In 2019, labor force participation and employment rates were high (81% and 78%, respectively) and similar to their 2018 levels. The real wage continued to climb, although at a slower rate than in previous years.

Arab Israeli and Haredi employment

Among Arab Israelis, employment rates remain low and there is potential for growth, among both men and women; the same is true for Haredi men.

  • The employment rate of Arab Israeli women remained nearly unchanged in 2019 after years of rising, but is expected to continue rising given this population’s improved education levels and enrollment in higher education.
  • The employment rate of Arab Israeli men has declined since 2017. The largest decrease occurred among those ages 20-24: from 67% in 2017 to 61% in 2019.
  • Haredi women are employed at high rates, despite their high fertility rates, and the rates are similar among married and unmarried women.
  • The employment rate of Haredi men (51%) is lower than it was in 2015, and for Haredi men who have studied in kollel (full-time Torah study frameworks) the figure is 31% lower than for those who have not.

Employment in Israel compared to the OECD

Compared with the OECD countries, Israeli men’s and women’s employment rates are close to the median employment rates, but with large differences between sectors.

  • The employment rates of non-Haredi Jewish women and men rank high in comparison to the OECD, but Arab Israeli men and women are near the bottom of the employment-rate scale.
  • Employment rates are particularly high among non-Haredi Jewish women (82%) and Haredi women (74%), despite relatively high fertility rates (2.6 and 7 children per woman, respectively).
  • The OECD ranks Israel as fourth from last with respect to work-life balance: high employment and fertility rates among non-Haredi Jews seem to make it difficult for them to combine work, family, and leisure.

Family and work in Israel

Half of Israelis between the ages of 25 and 64 live in households with children under the age of 18; 71% of these households are headed by couples. The share of single-parent households is small (8%).

  • As of 2017, in 40% of couple-headed households both partners were employed full-time, while in 37% of these households the father worked more hours than the mother.
  • In 51% of non-Haredi Jewish households both parents work full-time, versus 25% in Arab Israeli households, and only 13% in Haredi households. In 43% of Haredi households neither partner works full-time, compared with 15% of Arab Israeli households, and just 11% of non-Haredi Jewish households.
    • Only 56% of female workers and 59% of male workers expressed satisfaction with their work-life balance. Overall, work-life balance satisfaction levels of people without children under the age of 18 were found to be higher, while those of non-Haredi Jews were the lowest.
      labor 1

    Employment by age

    Employment rates for those ages 25-40 in the population as a whole rise, and fall thereafter.

    • The employment rate of non-Haredi Jewish men increases up to age 39, then drops, especially around retirement at ages 65-69. The employment rate of Arab Israeli men drops across the entire age range, while that of Haredi men rises to age 50.
    • The employment rate of non-Haredi Jewish women is stable until around age 54, while among Haredi and Arab Israeli women, the decline begins from a relatively younger age, with a sharp drop from age 50.


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