Construction Industry Leaders Urge Stable Foreign Workforce Amid Housing Needs
Israel's construction sector is grappling with a significant shift following the departure of tens of thousands of Palestinian workers after the outbreak of war nearly three years ago. This labor shortage has prompted a substantial increase in the employment of foreign workers, with approximately 75,000 now working in the industry.
Eldad Nitzan, chairman of the Association of Foreign Manpower Corporations in Construction, highlighted this change as a "fundamental shift" forced by the war. He emphasized that the construction industry requires continuity, and the sudden disappearance of a major labor source due to security events severely impacts project execution. Nitzan stated that it is now clear a more stable workforce foundation is necessary.
Beyond intergovernmental agreements, private recruitment by corporations and employers has expanded. Nitzan praised the Ministry of Construction and Housing and the Population and Immigration Authority for recognizing that the pace of bringing in workers is crucial for resuming construction site activity. He noted that the presence of a predictable foreign workforce allows contractors to create realistic work schedules, coordinate with suppliers and subcontractors, and advance projects without fear of disruption from security changes.
This influx of workers arrives as the housing market faces challenges from high interest rates, the ongoing war, and cautious buyers. Nitzan, however, believes the demand for housing remains strong due to population growth and the needs of young couples. He stressed that the construction workforce must be prepared in advance to meet future housing demands, estimating Israel needs to build 80,000 to 100,000 housing units annually to meet needs.
Large infrastructure projects, including the Gush Dan metro, railways, and national roads, will also require substantial labor. Nitzan advocates for diversifying source countries, suggesting Vietnam as a potential new source, to avoid replacing one dependency with another. He noted the decline in Chinese workers and limitations on new arrivals from China.
As the foreign workforce grows, Nitzan acknowledged increased state responsibility. He estimates the total number of foreign workers across all sectors could reach 400,000 to 500,000, necessitating planning for housing, transportation, healthcare, and oversight. He stressed that expanding quotas must be accompanied by enforcement, protection of workers' rights, prevention of illegal employment, and orderly departures. Nitzan concluded that returning to the pre-war situation would be a step backward for the economy, and the current changes must be formalized into a stable policy.
