Just a Taste: A Picture of the Nation 2019
Author: Taub Center Staff Bulletin Articles

A Picture of the Nation 2019, published last month by the Taub Center thanks to the generous support of the Koret Foundation, tells the story of Israel’s economy and society. The overall picture that emerges shows a rise in the standard of living alongside numerous challenges and areas in need of improvement.

The education system in Israel has shown visible signs of strengthening in the past few years along with continuing signs of weakness. For example, between 2010 and 2015, per-student expenditure in Israel has increased by approximately 25% while in other OECD countries, the growth was only 4%.

Nevertheless, in real terms, per-student expenditure in Israel remains lower than the average in other countries. Similarly, improvement in Israeli students’ scores on international achievement exams was greater than in other countries, however, Israeli students’ scores remain lower than the average scores in other countries.

The Ministry of Education’s efforts to increase the number of high school graduates obtaining bagrut (matriculation) certificates at the highest level (five units) in math and English, as well as their efforts to increase public awareness regarding the importance of these fields to future employment prospects, has led to a 20% increase in the number of students taking the bagrut exams in these subjects at the highest level since 2013.

In addition, the share of students in technology education – among the Ministry of Education’s declared goals in the past few years – has grown in the majority of Israel’s population. The total share of the 12th grade student population in technology education rose to 40% in 2017.

The most significant growth took place among students in high technology studies, characterized by high scholastic and bagrut achievements, with a disproportionate number of these students coming from strong socioeconomic backgrounds. The number of schools offering this course of study has also increased.

However, there are significant differences between population sectors and genders. The share of Arab Israeli students in high technology studies is sharply increasing, in particular among the Druze and Bedouin, where the share is higher than among the Jewish population.

The rate of bagrut qualification in the high technology track is similar for Jewish and Arab Israeli students (about 85%), and even among Bedouin, the share of those with bagrut qualifications in 2017 rose to 74%. This is a very positive trend that can lead to better integration of the Arab Israeli population into prestigious sectors of the Israeli labor market in the future.

In terms of gender differences, in the Jewish sector, the share of girls in the high technology track is substantially smaller than their share in the student population, particularly in State-religious education. However, in the Arab Israeli sector, the opposite is true.

Here, too, the change is especially striking in the Druze and Bedouin sectors. Among the Bedouin, the gap between female and male students is the largest: the share of girls studying in the high technology track rose from 6% to 21% between 2006 and 2017, and among boys, it rose from 6% to only 12%.
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Employment and labor force participation rates continue to rise, while unemployment rates are hitting historical lows of around 3.5%. The greatest improvement is among women, and especially Arab Israeli women. It is apparent that the sharp rise in their employment matches the rise in their education and enrollment rates in higher education. These changes are likely to continue to impact developments in Arab Israeli society.

The increase in labor force participation rates is due in part to steps taken by the State to encourage employment in various population groups. These measures include programs for integrating Arab Israelis and Haredim into the labor market; broadening the criteria of eligibility for work grants (negative income tax); investments in day care for young children; and the “Families First” program of the Ministry of Labor, Social Affairs and Social Services (in conjunction with JDC and the Rashi Foundation).

However, despite the efforts of the welfare system to encourage employment, expenditures on programs aimed at optimizing integration into the labor force, such as vocational training programs, investing in employment centers and in programs aimed at integrating individuals with disabilities into the labor market, are among the lowest of the OECD countries.

This lack of investment in raising the skill level of workers is felt strongly in PIAAC exams, an OECD survey measuring skill levels for workers ages 16-65. The survey shows that the skill level among the most skilled in Israel is similar to that of workers in other countries, however, for less skilled workers there is gap relative to other OECD countries, with the gap widening as skill levels decline.

Practically, this means that there are large disparities between the skill levels of workers in the high tech sector (generally among the highest skilled employees in the labor force) and workers in the rest of the labor market; skill levels of workers in high tech are nearly a full standard deviation higher than those of workers in the rest of the economy – a gap that is far greater than in other countries.

The situation is especially worrying among Arab Israelis, whose skill levels are particularly low in all parts of the labor force distribution. The survey findings demonstrate the need to strengthen the weakest sectors of the population.

This short survey is just a small taste of the research presented in A Picture of the Nation. We invite you to read more stories of the economy and society in Israel and the issues of the economy and standard of living, demography, education and higher education, employment, health, and welfare.