Israel Faces Worker Shortage as Foreign Labor Approval Stalls
Translated & summarized from Walla by baba
Israeli employers are furious with the Ministry of Finance for delaying a NIS 10 million budget transfer, which is holding up the arrival of 50,000 foreign workers. The delay is worsening labor shortages in construction and other key sectors, threatening economic damage and price hikes. The construction industry warns of a 5% rise in housing prices if the issue is not resolved soon. Employers are calling for the immediate release of the funds to allow the government's plan to proceed.
The story in 5 lines · by baba
- Employers are angry over a NIS 10 million budget delay by the Finance Ministry affecting foreign worker permits.
- The delay prevents the entry of approximately 50,000 foreign workers needed in construction and industry.
- The construction sector warns of a potential 5% increase in housing prices due to the worker shortage.
- Key industries face significant labor deficits exacerbated by the ongoing delay.
- Employers urge the Finance Ministry to release funds and allow the government's foreign worker plan to proceed.
Employers across Israel's construction, industry, commerce, and services sectors are expressing anger over a delay by the Ministry of Finance in transferring a NIS 10 million budget to the Population and Immigration Authority. Employers claim the ministry failed to uphold its commitment to fund a government decision to increase the proportion of foreign workers in Israel from 3.3% to 3.8% of the total population. This increase was intended to allow approximately 50,000 additional foreign workers into the country, distributed among various sectors: 20,000 for construction, 15,000 for the metro project, and 15,000 for industry and commerce.
According to employer representatives, the budget delay is preventing the program's advancement and the entry of needed foreign labor, exacerbating significant workforce shortages in key economic sectors. They warn that continued delays could lead to extensive economic damage, impede projects and production, disrupt raw material supply chains, and cause price increases.
The construction industry, which has faced a severe worker deficit since October 7, 2023, is particularly vulnerable. Without an increased quota for foreign workers, construction pace is expected to slow, projects will be delayed, and the labor shortage could drive up housing prices.
Nitzan stated that implementing the government-approved plan would allow for the full quota of workers, ensure work continuity, and maintain the construction sector's normal operations, which is a key driver of the Israeli economy. He added that the arrival of these additional foreign workers could help the sector return to activity levels seen before October 7, 2023, when approximately 120,000 Palestinian workers were employed in construction. Employers are urging the Ministry of Finance to release the promised budget promptly to advance the government's decision and prevent further economic damage.
