Labor Market Report Shows Sharp Decline in Employment Among Ultra-Orthodox Men Amid Ongoing Conflict

A recent labor market report highlights a troubling decline in employment rates among ultra-Orthodox men in Israel, exacerbated by the prolonged war and significant technological changes. The average real wage increased by only 0.3%, reflecting a slow economic recovery. The conflict severely impacted employment in evacuated communities and frontline areas, particularly in northern border settlements where the employment rate dropped from 77.6% before the war to 74% currently. Ultra-Orthodox men experienced the steepest decline, with employment rates falling from 79% pre-war to 64% in the second half of 2025.

The quality and nature of employment in growth towns also suffered, largely due to their industrial concentration in sectors like manufacturing, construction, and agriculture, which struggle to maintain employment during crises. Meanwhile, remote work has become an established emergency mechanism, with 17-20% of workers regularly working from home during peacetime and peaking at 25% during Operation "With the Lion." This shift, developed since the COVID-19 pandemic, has helped mitigate some economic damage during emergencies.

The report underscores the complex challenges facing Israel’s labor market, combining the effects of ongoing conflict with rapid technological shifts, and points to the need for adaptive employment strategies in vulnerable communities and sectors.