Israel Invests Heavily in Education as Percentage of GDP, But Spends Less Per Student

New data from the OECD for 2023, released by Israel's Central Bureau of Statistics, reveals a significant disparity in the Israeli education system. While Israel dedicates 7.1% of its GDP to education, surpassing the OECD average of 5.3%, the per-student expenditure remains considerably lower across most educational levels. This is particularly pronounced in early childhood education, where Israel spends $7,104 per child compared to the developed countries' average of $13,904. Higher education also shows a substantial gap, with spending per student being about 35% lower in Israel, and a significantly higher proportion of private funding.

Despite Israel's high overall investment relative to its GDP, the per-student spending paints a different picture. In elementary education, Israel invested $13,945 per student, slightly above the developed countries' average of $13,639. However, in secondary education, the gap widens, with Israel spending $12,798 per student versus the average of $14,994. In higher education, Israeli students receive $14,966, compared to the average of $22,878.

One primary explanation for this discrepancy is Israel's demographic structure. In 2023, individuals aged 0-24 constituted approximately 43% of Israel's population, compared to the developed countries' average of 28.6%. This means that even with a larger share of GDP allocated to education, the budget is divided among a greater number of students.

Public funding for educational institutions in Israel, excluding pre-primary education, accounted for 79.9% in 2023, slightly below the OECD average of 82.9%. In elementary and secondary education, including pre-academic preparatory programs, public funding was 90.5%, matching the OECD average. However, the transition to higher education shows a stark contrast, with private sources funding 58.6% of total expenditure in Israel, compared to just 32.9% on average in OECD countries. For instance, the UK had 78.2% private funding and Australia 66.1%, while Norway had only 8.8%.

Overall government spending per student in Israel was $10,913, compared to $13,599 on average. In elementary, secondary, and preparatory programs, government spending was $12,064 per student, versus $13,227 average. The disparity is even greater in higher education, where Israeli government spending per student is $6,202, a staggering 61% lower than the OECD average of $15,960. While Israel allocates 4.9% of its GDP to elementary and secondary education combined, exceeding the developed countries' 3.3%, its higher education spending is 1.3% of GDP, slightly below the OECD average of 1.4%. The data suggests that while Israel's overall commitment to education is high, the lower per-student investment in early childhood, secondary, and higher education raises questions about the resources available to educational institutions.